Russia holds key rate at 21% as inflationary pressure remains high

Record ID: 1985169

  • Title: Russia holds key rate at 21% as inflationary pressure remains high
  • Date: 21st March 2025
  • Summary: BLACK PEAK SUMMIT, VITOSHA MOUNTAIN, BULGARIA (MARCH 21, 2025) (REUTERS) VARIOUS OF DRONE VIEWS OF BLACK PEAK SUMMIT VARIOUS OF ULTRAMARATHON RUNNER VICTOR ASENOV AND PACERS, VOLUNTEERS WHO SET PACE OF RUN VARIOUS OF VIEWS OF SOFIA FROM BLACK PEAK SUMMIT (SOUNDBITE) (Bulgarian) ULTRAMARATHON RUNNER, VICTOR ASENOV, SAYING: "Everesting is starting from one point to another s
  • Embargoed:
  • Keywords: Central Bank Economy Inflation Nabiullina Rates Russian
  • Location: MOSCOW, RUSSIA
  • City: MOSCOW, RUSSIA
  • Country: Russia
  • Topics: Europe,Budget/Taxation/Revenue,Government/Politics
  • Reuters ID: LVA009068121032025RP1
  • Aspect Ratio: 16:9
  • Story Text: Russian Central bank Governor Elvira Nabiullina and her deputy Alexei Zabotkin addressed a news conference on Friday (March 21) after the central bank, as expected, kept its key interest rate on hold at 21%.
    The central bank raised its interest rate to 21% last October, the highest level since the early 2000s, in an effort to contain inflation, Russia's main economic challenge.
    President Vladimir Putin urged his economic officials this week not to freeze the Russian economy as if it were in a "cryotherapy chamber" with their tight monetary policy.
    Putin spoke to Russian business leaders, many of whom openly oppose the central bank's policy and argue that it is stifling the economy and investment.
    The central bank forecasts that economic growth will fall to 1-2% in 2025 from 4.1% in 2024 as a result of its monetary policy, while the government expects the economy to grow by 2.5% in 2025.
    Weekly inflation, an important gauge closely monitored by the central bank, slowed to the lowest level since the start of the year, according to the latest data. Meanwhile, the annual inflation rate also slipped slightly but remained above 10%.
    Inflation expectations among Russian households for the year ahead, another important factor considered by the board, were also at their lowest level since August 24, 2024. The central bank's inflation target is 4%.
    The regulator said key inflationary risks are linked to economic overheating, high inflation expectations and deteriorating foreign trade conditions as a result of sanctions.
    The rouble, which has rallied by up to 28% this year on expectations of easing tensions between Russia and the United States and a peaceful settlement in Ukraine, is also helping to combat inflation as it makes imported goods cheaper.
  • Copyright Holder: REUTERS
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