The Central Bank decided to cut the key rate by three percentage points – from 17% to 14%

The Central Bank of Russia decided to lower the key rate by three percentage points at once – from 17% to 14%. This is stated in an official statement posted today, April 29, on the website of the regulator.

The Bank of Russia justified its decision by saying that the risks to the price and financial stability of the country’s economy have ceased to grow. In this regard, conditions have arisen that make it possible to reduce the size of the key rate.

The department noted that the latest data indicate a slowdown in price increases. The regulator attributes this to the strengthening of the Russian ruble and the “cooling” of consumer activity.

Despite all the positive moments, the Central Bank stated that the external conditions for the Russian economy remain difficult and significantly limit economic activity.

Earlier, the head of the Accounts Chamber Alexei Kudrin, speaking at a meeting of the Council of Legislators of the Russian Federation, said that according to the results of the current year, inflation in Russia, according to the baseline forecast, will be 20.7%. According to Kudrin, next year it will also be rather big – more than 6%. As for the fall of the economy, here Kudrin also gave disappointing figures: according to preliminary estimates of the Ministry of Economic Development of the Russian Federation, the country’s GDP in 2022 will fall by 8.8%, and according to a more conservative scenario – by 12.4%.

S&P Global Market Intelligence analysts believe that it will take 10 years for the Russian economy to recover to the level of 2021 after the introduction of sanctions restrictions on the country. Experts believe that this year the fall in GDP will be 11.1%, by 2023 it will slow down to 1.9%, and in another year the Russian economy will go into growth – by 1.6%. According to analysts, by 2026 Russia’s GDP will increase by 1.9%. According to the forecast, this year inflation in Russia will be 17.8%, in 2023 it will slow down to 10%, and by 2026 – to 4.6%.