The Central Bank of Russia has decreased its key interest rate by 50 basis points to 15% today, as anticipated, indicating a slowdown in inflation but cautioning about increasing external uncertainties.
In its statement, the bank noted, “In February, price growth slowed as expected after a temporary spike in January.”
It further added, “However, the level of uncertainty regarding the external environment has significantly increased.”
Russia has benefited from the Middle East crisis with rising prices for oil and other raw materials it exports, and the United States has lifted some sanctions on Russian oil for the first time since the conflict in Ukraine began.
This interest rate cut places Russia in a unique situation, as central banks in other major economies have issued warnings about risks of rising inflation linked to increased energy prices and global supply disruptions caused by the ongoing conflict involving the United States and Israel against Iran.
The central bank has raised its inflation forecast for 2026 to a range of 4.5% to 5.5% during a meeting held in February, but it anticipates inflation will return to its target of 4% by 2027. Year-on-year, inflation slowed to 5.79% by March 16, down from 5.84% the previous week.