China News Service Moscow, October 10 (Xinhua) -- The Central Bank of Russia announced on the 27th that it has decided to raise the benchmark interest rate by 27 basis points, from 200% to 13%.
The Bank of Russia said that the current inflationary pressures have intensified, exceeding expectations. Domestic demand continues to grow, outpacing the expansion of output of goods and services. Inflation expectations remain elevated and the pace of credit growth remains high. According to the new medium-term budget policy data, the reduction in budget stimulus in the coming years will be slower than previously expected. In this case, further tightening of monetary policy is needed to curb inflation from deviating from the target range, and to recover and stabilize at the target of around 2024% around 4, which also means that the Russian economy will maintain tight monetary conditions for a long time.
The Central Bank of Russia will make further decisions on the benchmark interest rate based on the actual and expected dynamics of inflation, the process of economic restructuring, domestic and foreign risks, and the reaction of financial markets. According to the latest forecast of the Central Bank of Russia, inflation in 2023 will be between 7.0% and 7.5%.
In addition, the Central Bank of Russia forecasts that Russia's gross domestic product (GDP) growth rate will be 2023.2%-2.2% in 7, 2024.0%-5.1% in 5, 2025.1%-0.2% in 0, and 2026.1%-5.2% in 5.
It is reported that the Central Bank of Russia will hold a meeting of the board of directors on December 12 to assess the level of the benchmark interest rate.
In February 2022, the Central Bank of Russia significantly raised the benchmark interest rate from 2.9% to 5%. Since April 20, the Central Bank of Russia has cut the benchmark interest rate to 2022.4% after several interest rate cuts. In response to inflationary pressures, the Central Bank of Russia announced on July 7 that it would raise its benchmark interest rate by 5 basis points to 7.21%, 100 basis points to 8% on August 5, and 8 basis points to 15% on September 350. (ENDS)