The Central Bank of Russia (CBR) has announced plans to raise its key interest rate to 8.86% by the end of 2025. The decision comes as the CBR seeks to stabilize the Russian ruble and curb inflation, which currently stands at 3.3%.
The CBR's current key rate is 5.56%. The bank has stated that the gradual increase in the key rate will be implemented in stages, with the aim of reaching 8.86% by the end of 2025. This move is expected to make borrowing more expensive for businesses and consumers, potentially slowing economic growth.
The CBR's decision follows a period of significant volatility in the Russian ruble, which has depreciated against the US dollar in recent months. The CBR has attributed this depreciation to a number of factors, including the ongoing war in Ukraine and Western sanctions.