The Bank of Russia sharply raised its key rate – Rosbalt

Following the meeting on Friday, the Board of Directors of the Central Bank of the Russian Federation increased the value of the key rate by 100 basis points at once to 9.5% per annum, follows from the press service of the Central Bank of the Russian Federation.

Thus, the rate was sharply raised already at the first meeting of the Central Bank this year. Today’s decision of the regulator was expected by most analysts.

The key rate of the Bank of Russia is the main instrument of the regulator’s monetary policy. This is the rate at which the regulator lends money to commercial banks. At the same time, it serves as a signal for financial organizations that focus on the key rate, issuing loans and attracting deposits.

As stated by the Central Bank in its press release, “inflation is much higher than the October forecast of the Bank of Russia.”

“Demand expansion continues to outstrip output growth opportunities. The rapid growth of economic activity with limited available labor resources increases inflationary pressure. The conjuncture of world commodity markets remains pro-inflationary. Inflation expectations are not decreasing yet, remaining at multi-year highs,” the regulator emphasizes.

The next meeting of the Board of Directors of the Central Bank, which will consider the issue of the key rate level, is scheduled for March 18, 2022.

Recall also that, according to Rosstat, consumer prices in the country for the period from January 22 to January 28 rose by 0.19%, and in annual comparison, according to the estimates of the Ministry of Economic Development, inflation reached 8.82% against 8.64% a week earlier .

Russia ended last year with an inflation rate of 8.39%, which was more than double the target of the Central Bank of the Russian Federation.