OREANDA-NEWS. May 14, 2009. The Central Bank of Russia has lowered the national refinancing rate by 0.5% for the second time over the past three weeks on the back of surging crude prices, a strengthening ruble and moderating inflation. CBR reduced the refinancing rate to 12% effective May 14, 2009.

The previous rate cut (to 12.5% from 13% effective April 24, 2009) was the first in the past two years. At the same time, monetary authorities reduced the key minimal interest rate for daily auction-based repurchase transactions also by 0.5% to 9%.

On Wednesday first deputy CBR chairman Alexey Ulyukaev said May inflation would not exceed 1%. Last May prices jumped 1.4%. At the same time, oil futures, which had been trading at USD 46/bbl after April 20, are closing in on USD 60/bbl and against this backdrop only the central bank’s interventions can prevent the ruble from strengthening substantially.