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MOSCOW, February 16 The Bank of Russia kept the key rate at 16 percent per annum, follows from the statement of the Central Bank.
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“On February 16, 2024, the Board of Directors of the Bank of Russia decided to maintain the key rate at 16.00 percent per annum,” the regulator noted.
The key rate is the minimum percentage at which the Central Bank issues loans to commercial banks and accepts money from them for deposits. Its size affects inflation. When the regulator raises the key rate, money in the economy becomes more expensive — bank rates on loans and deposits for households and businesses increase. It becomes more profitable to open deposits and save than to spend and take out loans. Therefore, the demand for goods and services decreases, prices begin to rise more slowly, and inflation slows down.
This was the first pause since June last year.
The Bank of Russia has been to combat accelerating inflation, it began to raise the key rate — at first by only one percentage point, but a month later, in August, the Central Bank, against the backdrop of the falling ruble exchange rate, sharply raised the rate at an extraordinary meeting — by 3.5 percentage points. In the fall, the regulator added three percentage points, and in December — another percentage point, bringing the figure to 16 percent.
Analysts surveyed expected that the Bank of Russia this Friday, against the backdrop of stabilization of the situation with inflation and inflation expectations, as well as for the need to evaluate the effect of decisions already made, it will keep the key rate at the current level.