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Central Bank · Economy · Interest Rates · Russia
Russia's central bank cut its key interest rate by 150 basis points to 9.5% in June, bringing borrowing costs back to pre-war levels, exceeding market expectations for a 100 basis point decrease.
The Bank of Russia stated the external environment for the Russian economy remains challenging, significantly constraining economic activity. The contraction in imports due to external trade and financial restrictions is considerably outstripping the decline in exports.
The bank also reported that inflation is slowing faster and the decline in economic activity is of a smaller magnitude than the Bank of Russia expected in April. Annual inflation in Russia fell to 17.1% in May 2022, below market expectations of 17.3%.
The Russian ruble is hovering around 58 against the dollar.
