Russia keeps key interest rate at 7.5pc

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Russia’s central bank decided on Friday to keep its key interest rate unchanged at 7.5 percent per annum.

“Current consumer prices are growing at a moderate rate and consumer demand is subdued. Inflation expectations of households and businesses, essentially unchanged, remain elevated,” the bank said in a statement.

“At the same time, pro-inflation risks are up and prevail over dis-inflationary risks. This comes as a result of rising inflation pressures from the labor market, worsening foreign trade conditions and a softer fiscal stance,” it added

The central bank forecast that annual inflation in Russia will decline to 5-7 percent in 2023 and further down to 4 percent in 2024 given the current monetary policy.

Russia drastically raised the key interest rate from 9.5 percent to 20 percent on Feb. 28 this year to support financial and price stability and protect the savings of citizens from depreciation, days after it launched a special military operation in Ukraine.—APP