Central Bank warns of new key rate hike while inflation remains unchanged

Participants of the discussion on the key rate of the Central Bank (CBR) of the Russian Federation reported that if by the next meeting of the Board of Directors inflation does not go down, and the accelerated growth of lending resumes, the key rate may be raised. This is stated in the summary after the meeting of the Board of Directors of the Central Bank on December 28.

It is specified that core inflation in October-November rose from 7.6% in Q3 to 10.9%, and since the beginning of the year, most indicators of sustainable inflation have risen to a maximum.

The text also notes that if the rate is maintained, it is assumed that credit growth will accelerate again in the near future, while inflation will continue to rise, Gazeta.Ru added.

Not expected, but guessed: what's behind the Central Bank's decision not to raise the key rate

And how politicians, bankers and businesses have reacted to it

December 20, the Central Bank Board of Directors decided to keep the key rate at 21% per annum. The regulator specified that there was a more significant tightening of monetary conditions than it was assumed in October.

Later, December 24, Associate Professor of the Department of Economic Policy and Economic Measurements of GUU Maxim Chirkov admitted in a conversation with "Izvestia" that the Central Bank will start reducing the key rate in 2025, because the effect of tightening monetary policy will begin to manifest itself.