Bank of Russia Maintains Key Rates at 21%

The Bank of Russia has decided to keep its key interest rates unchanged at 21%, a move aimed at ensuring monetary conditions remain sufficiently tight to steer inflation back to its 4% target by 2026. This decision comes as the central bank forecasts inflation for 2025 to hover between 7% and 8%, mirroring projections from last month's meeting, with the first quarter averaging at 8.3%.

Inflationary Pressures and Economic Balance

While the central bank anticipates a gradual decline in inflationary pressures in the upcoming months, it cautions that elevated inflation expectations may slow the pace of this decrease. Additionally, the Bank highlighted that despite the economy beginning to realign towards a balanced growth trajectory, the expansion of domestic demand continues to significantly surpass the capacity to increase the supply of goods and services.