The Central Bank of the Russian Federation saw an opportunity to lower the key rate while strengthening the ruble

The Central Bank of the Russian Federation's retention of the key rate for 2025 in the range of 19.5–21.5% means that monetary policy can be both softened and strengthened, but the first option is most likely against the background of a steady strengthening of the ruble since March. This was announced on April 25 by the Chairman of the Bank of Russia, Elvira Nabiullina.

As the head of the Central Bank noted, the ongoing strengthening of the ruble largely reflects the tight monetary policy in the country.

"And the current strengthening of the ruble, if it is stable, it does not contradict — on the contrary, it corresponds to our achievement of the goal of returning inflation to 4%. Indeed, if this strengthening of the exchange rate is sustained, it will mean that space is being created for an earlier reduction in the key rate," Nabiullina said at a press conference.

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She also noted that in order to reduce inflation in Russia, it is necessary to maintain a tight labor market for a long time. According to her, the regulator expects that inflation will continue to decline and fall to the target level of 4% in 2026. Nabiullina said that the current rate of price growth has slowed to 7% in annual terms.

On April 25, the Board of Directors of the Bank of Russia decided to keep the key rate at 21.00% per annum. The press service of the Central Bank of Russia noted that the current inflationary pressure, including steady, continues to decrease, although it remains high. It is specified that the average key rate in the range in 2025 is expected to be 19.5–21.5% per annum.

On April 15, Russian President Vladimir Putin announced an improvement in the inflation situation in Russia. He noted that the Central Bank, the economic bloc and the government believe that if it is not reduced, then the entire economy and Russian citizens will suffer.