Performance data of the MOEX Russia Index

Bank of Russia Holds Key Interest Rate at 21%, Surprising Analysts Who Expected 23%, Amid 8.9% Inflation

Dec 20, 2024, 11:00 AM

The Bank of Russia has decided to maintain its key interest rate at 21% per annum, a move that has surprised many analysts who anticipated a hike to 23% to combat rising inflation. This decision comes amid expectations that inflation will increase from the current rate of 8.9% to 9.2% by the end of the year. The central bank's action follows significant criticism from major Russian business leaders regarding the monetary policy. The decision to hold rates was also influenced by a tightening of monetary conditions that exceeded previous forecasts. The announcement has led to a rise in the Russian market, reflecting a positive response to the central bank's unexpected stance.