From Yahoo Finance: 2025-04-25 06:34:00

The Russian central bank kept its key interest rate at 21% due to global economic turbulence caused by U.S. trade tariffs. Inflation is declining, but lower oil prices pose new risks for the Russian economy. Central bank governor Nabiullina warns of proinflationary effects if trade tensions escalate.

Despite the impact of trade wars, the rouble’s surge against the dollar has helped combat inflation. Inflation pressures are decreasing, with a forecast of 7.0-8.0% for 2025 and a return to the 4.0% target in 2026. Nabiullina expects a sustainable decline in inflation by May 2024.

The central bank left room for potential rate hikes and welcomed the idea of saving oil revenues to create a safety cushion during global turbulence. Nabiullina’s policies have faced criticism, but she is likely to stay in her role until 2027. The decision to maintain the rate aligns with analyst expectations for stability amid economic uncertainties.

Economic activity slowed in Q1 2025, with a decline in labor shortages. The central bank projects growth of 1-2% in 2025, below the government’s forecast of 2.5%. The next rate-setting meeting is scheduled for June 6. Predictable conditions are being created to reduce uncertainty amid trade wars and oil price instability.



Read more at Yahoo Finance: Russia keeps key rate on hold, braces for global turbulence