Russia’s central bank Governor Nabiullina sees rate-cutting cycle ending soon

Russia’s central bank Governor Elvira Nabiullina said in a Reuters interview, the Central Bank of the Russian Federation (Bank of Russia), will soon bring an end to its rate-cutting cycle and adopt a neutral monetary policy stance, despite the risks of increasing inflationary pressures.

Russia’s consumer price inflation is seen steadying at an annual 2.4 percent.

Key Quotes:

“We should switch to neutral monetary policy in the short run.

For now, we think that the level of the neutral rate is in the corridor from 6 to 7 percent, closer to the upper boundary.

A recent rise in fuel prices was a concern for the central bank as rising petrol prices result in higher inflationary expectations.

If some factors emerge which increase inflationary risks, we would need to again switch to a tighter policy.”