Russia’s central bank cut its key interest rate following an unscheduled meeting of policy makers Friday, but borrowing costs remained well above their level before President Vladimir Putin ordered the invasion of Ukraine.
In a statement announcing the reduction in the key rate to 17% from 20%, the Bank of Russia said the ruble’s USDRUB, -0.45% rebound from sharp losses in the days immediately following the Feb. 24 invasion had reduced the risk that inflation would move sharply higher.
“The latest weekly data point to a noticeable slowdown in the current price growth rates, including owing to the ruble’s exchange rate dynamics,” the central bank said.
The central bank more than doubled its key rate to 20% on Feb. 28 as it scrambled to support the ruble after seeing western governments freeze almost half of its foreign exchange reserves.
Write to Paul Hannon at [email protected]
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