Official GDP growth data from the Russian Federal State Statistics Service

Bank of Russia Hikes Key Interest Rate by Two Percentage Points to Record 21%, Highest Since 2003

Oct 25, 2024, 11:15 AM

The Bank of Russia has raised its key interest rate by two percentage points from 19% to a record 21%, the highest level since 2003. This decision aims to combat surging inflation, which has been exacerbated by increased military spending and economic imbalances. The rate hike exceeds market expectations, which had forecasted a rise to 20%. The central bank has indicated that further rate increases are possible in the future to manage inflationary pressures. This move follows several consecutive rate hikes and reflects the central bank's commitment to controlling inflation, which is projected to decline to 4.5-5.0% by 2025. Governor Nabiullina stated that the increase might slow down economic growth.