The Central Bank of Russia will reduce its key interest rate in the event of a sustained reduction in inflation and associated risks, the chairperson of Russia’s Central Bank Elvira Nabiullina said during the Congress of the Association of Russian Banks.
“If there’s a steady decline in inflation and inflationary expectations, the Bank of Russia will be able to cut the key rate more actively in the future without creating risks to financial stability,” she said.
“The Bank of Russia believes that reaching the 4% inflation target in 2017 isn’t just absolutely realistic, but is simply essential. In addition to the social effect, inflation is primarily a tax on the poor, on those who receive low incomes. Low inflation of 4% will reduce the investment risks for businesses and facilitate greater stability of the currency exchange rates, reducing the risks,” Nabiullina explained.
