the Central Bank of Russia lowered the key rate to 4.5%. This is a record low in the history of the country. Rate falls for the eighth time in a row, the last two months it was at 5.5%.
In a statement on the regulator’s website indicated that the reduction of the key rate will help keep inflation around 4%. The figure had lowered due mode coronavirus restrictions in Russia and the world.
According on the 15th of June the annual inflation rate was about 3.1%. The Central Bank suggest that price growth will slow due to the fact that the ruble in recent months has strengthened. However, economic activity is still under attack due extension mode restrictions.
“Increased unemployment and decreased income, decreased significantly, the turnover of retail trade. The gradual lifting of restrictive measures in may and June contributes to the gradual recovery of the sector-oriented consumption. However surveys continue reflects the persistence of cautious business sentiment,” — said in the message.
the Central Bank has kept the forecast of an annual fall in GDP of 4-6% and the expectation of “recovery growth” of the economy in 2021 or 2022. The regulator has allowed a further reduction of the key rate at the next meeting. The decision will be based on financial performance in the country. The next meeting is scheduled for July 24.