Is Bank of Russia ready to cut key rate?

Russia's Central Bank chief Elvira Nabiullina said that the Bank of Russia is ready to consider an opportunity for reduction of the key rate in the short run.

"We raised the key rate at the turn of the last year because we noticed growth of inflationary risks, including associated with VAT increase," she said on the sidelines of the St. Petersburg International Economic Forum.

"We were concerned of secondary effects that might be triggered by VAT increase because inflation expectations in our country are not anchored and remain at a higher level," TASS cited her as saying. 

"Therefore we took advance measures and they provided the effect. Inflation has started declining quickly. We said therefore that we are ready to consider the key rate cut shortly," Nabiullina concluded.

The next meeting of the Board of Directors of the Central Bank dedicated to the key rate will be on June 14. The key rate is 7.75% now.