The Central Bank of Russia (CBR) has increased the key interest rate from 19% to 21%, on Friday, 25 October 2024.
The initiative is an effort to combat growing inflation as government spending on military strains the economy’s capacity to produce goods and services.
In a statement, the Central Bank said “growth in domestic demand is still significantly outstripping the capabilities to expand the supply of goods and services.”
“Inflation is running considerably above the Bank of Russia’s July forecast,” and “inflation expectations continue to increase.”
It held out the prospect of more rate increases in December.
This is the highest key interest rate in Russia since it was introduced in 2013.
The key interest rate is utilised for calculating interest deductions and late payment interest on overdue taxes in Russia.
