Russian cenbank says 50 bps rate cut unlikely in July

Russian cenbank says 50 bps rate cut unlikely in July

The Russian central bank is unlikely to cut its key interest rate by 50 basis points next week as it prefers smaller shifts in its policy, the bank’s head of monetary policy, Alexei Zabotkin, said in an interview published on Thursday, Reuters reports.

“There should be weighty arguments to move to a 50 basis-point step,” Zabotkin said in an interview with Bloomberg, adding that there have been no surprises on the data front that would justify such a move.

Zabotkin’s statement echoed what his boss, Governor Elvira Nabiullina, said in an interview with Reuters in late June.

Nabiullina said the central bank, which cut its key rate by 25 basis points to 7.50% on June 14, would prefer small cuts in the future to complete its monetary easing cycle by mid-2020, aiming at keeping annual inflation close to the 4% target.

In early July, Nabiullina said the central bank would consider a rate cut at its board meeting on July 26, adding that a deeper rate cut — 50 basis points instead of 25 — was among possible options.

Zabotkin told Bloomberg that the central bank would also consider holding its key rate unchanged at the meeting next week.


Vestnik Kavkaza

on YouTube