MOSCOW: The Board of Directors of the Bank of Russia did not discuss key rate lowering at the meeting today, central bank chief Elvira Nabi...
MOSCOW: The Board of Directors of the Bank of Russia did not discuss key rate lowering at the meeting today, central bank chief Elvira Nabiullina said at the press conference after the meeting.
TASS collects key statements of the Governor of the Bank of Russia.
Key rate
The probability of further increase of the key rate "declined." Rate reduction can only be expected "after we will be confident that inflation is declining consistently, steadily, and with the pace enabling us to return inflation to 4% in 2026."
The Central Bank has only discussed the rate keeping and the signal on further actions earlier today. The regulator makes decision on the key rate independently but is always "in touch" with the government.
The situation when deposit rates were above the key rate in November - December 2024 is not a standard one. "The situation is more or less normal now," Nabiullina said.
Inflation
Conclusions on the scale of the effect of ruble strengthening on inflation are premature so far. The Bank of Russia believes that the budget will have the disinflationary effect this year.
The regulator’s policy "is being built on stable trends, fundamental factors, firm facts and conservative approach to risk assessment." Improvement in foreign trade conditions will be a disinflationary factor but only if both imports and exports expand.
Price growth
Current price growth rates are going down gradually.
National economy and ruble rate
The Russian economy is in the zone of higher uncertainty, particularly due to external conditions, but follows the "soft landing’ path. The exchange rate of the ruble against the dollar and the yuan is approximately where it was last summer.
Currency rate
The Central Bank is not going to interfere in the mechanism of currency rate forming by banks.
Assets and sanctions
The attractiveness of ruble assets increased owing to the reassessment of geopolitical risks and high returns in rubles.
The Bank of Russia has no credible data about growth of nonresidents’ interest in Russian assets. The regulator assumes in its forecasts that the sanction pressure will remain at its current level. Discussions on the potential release of Russian assets seem to be premature.
Cryptocurrency
The regulator suggests prohibiting payments in cryptocurrencies outside the experimental regime. The Central Bank does not see circumstances for inclusion of cryptocurrency into its reserves.
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