Financier predicted a key rate cut in February

The Central Bank may lower the key rate at its February meeting if inflation expectations continue to decline and the cooling of lending continues. Svetlana Frumina, Acting Head of the Department of Global Financial Markets and Fintech at the Plekhanov Russian Economic University, told Prime on January 9.

"The ongoing reduction in lending to the corporate sector is working to reduce inflation. Banks have suspended the issuance of previously approved loans and raised rates. At the same time, some banks continue to increase deposit rates, which stimulates the pumping of funds and ensures the withdrawal of part of the money from circulation," - said the expert.

The publication points out that in February a pause or a 1 p.p. rate cut is likely, provided that the next month will be noticeable positive dynamics in prices and inflation expectations.

Frumina notes that if the key rate remains high and the first signs of slowdown appear, it could be lowered.

In addition, the financier pointed out that stabilization and reduction can be expected not earlier than the end of the first quarter.

"The measures taken by the Central Bank have more effect on restricting supply than on restricting demand. Therefore, to fight inflation, parallel tools to stimulate production, including soft loans, are involved. The set of decisions taken should make it possible to defeat inflation," Frumina summarized.

Earlier in the day, Russian President Vladimir Putin at a meeting with members of the government on Thursday asked as soon as possible to submit to him proposals on mortgage measures to support both citizens and developers.

On December 28, participants in the discussion on the key rate of the Central Bank (CBR) of Russia said 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 could be raised.

On December 20, the Central Bank's 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 had been assumed in October.

Later, on December 24, Maksim Chirkov, associate professor at the Department of Economic Policy and Economic Measurements of the State University of Ukraine, admitted in a conversation with Izvestia that the Central Bank will start lowering the key rate in 2025, because the effect of monetary tightening will begin to manifest itself.