The Bank of Russia announced the reduction in the rate from one percentage point to 4.5%. This is a historic low, from the data controller. CB noted that due to the long restrictive measures because of the coronavirus disinflationary factors “are stronger than previously expected”. The impact of short-term proinflationary factors “largely exhausted”. Risks to financial stability declined, and inflation expectations of population and business has decreased. “In these circumstances there is a risk of significant deviation in inflation from 4% in 2021. The decision on the key rate is aimed at limiting this risk and keep inflation near 4%,”— said in the message. Earlier, the Chairman of the Central Bank Elvira Nabiullina said about the possibility to reduce the key rate “more decisive step”, including 1 AP She talked about the fact that moderate response of inflation expectations has allowed April to go to the soft monetary policy. According to the forecast of the savings Bank, by the end of September, the rate could fall to 4%.In April, the Central Bank lowered the key rate to 5.5% in March, the rate was maintained at 6%, while this rate was reduced six times since October.
