The Central Bank of Russia announced on Friday that it is keeping interest rates steady at 21%, noting that the current level of tightness will allow inflation to drop to the 4% target in 2026. However, it warned that reaching that goal will require a "long period of maintaining tight monetary conditions."
The Bank of Russia currently forecasts the inflation rate in 2025 will be between 7% and 8%. It said inflationary pressures have decreased but remain high, especially underlying ones, with headline inflation at 10.2% as of March 17. "Domestic demand growth is still significantly outstripping the capabilities to expand the supply of goods and services. Nevertheless, lending growth remains subdued, and households’ propensity to save remains high," the bank said in a statement.
