The Central Bank raised the key rate by one percentage point — to 16% per annum. This is reported on the regulator's website.
“Current inflation pressures remain high. At the end of 2023, annual inflation is expected to be close to the upper limit of the forecast range of 7.0-7.5%,” the Central Bank explained the increase in the key rate.
This is the fifth consecutive increase in the key rate since July 2023. The regulator last raised it in October from 13% to 15%.
The key rate is the minimum rate at which the Central Bank provides loans to commercial banks. Having received money from the Central Bank, they give loans to companies and individuals, and their interest rate becomes higher than the key rate of the Central Bank. At the same time, a high key rate not only increases interest rates on loans, but also slows down inflation.