21.07.2023, 21:36
The Central Bank of the Russian Federation raised the key rate by 100 bps at once - to 8.5%
Source: OREANDA-NEWS
OREANDA-NEWS The Board of Directors of the Bank of Russia at a meeting on Friday decided to raise the key rate immediately by 100 bps - up to 8.5%, the regulator said in a statement.
The decision to raise the rate was made for the first time since February last year, when the increase occurred from 9.5% to 20%. After that, until September, decisions were made either to reduce or to maintain the rate, and since September it has remained at 7.5% per annum.
Most analysts expected a rate increase of 50 bps, although some experts allowed for a broader step - up to 100 bps.
The Central Bank's July statement focuses on long-term pro-inflationary factors.
"The current rate of price growth, including a wide range of stable indicators, has exceeded 4% in terms of the year and continues to grow. The increase in domestic demand exceeds the possibilities of expanding production, including due to the limited availability of labor resources. This increases the steady inflationary pressure in the economy," the Bank of Russia reports.
The decision to raise the rate was made for the first time since February last year, when the increase occurred from 9.5% to 20%. After that, until September, decisions were made either to reduce or to maintain the rate, and since September it has remained at 7.5% per annum.
Most analysts expected a rate increase of 50 bps, although some experts allowed for a broader step - up to 100 bps.
The Central Bank's July statement focuses on long-term pro-inflationary factors.
"The current rate of price growth, including a wide range of stable indicators, has exceeded 4% in terms of the year and continues to grow. The increase in domestic demand exceeds the possibilities of expanding production, including due to the limited availability of labor resources. This increases the steady inflationary pressure in the economy," the Bank of Russia reports.
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