POST TIME: 15 December, 2019 00:00 00 AM
Russia cuts key rate as inflation slows
AFP, Moscow

Russia cuts key rate as inflation slows

The Russian central bank cut its key interest rate to 6.25 per cent on Friday as inflation continued to slow, and said it would consider further reductions in the first half of 2020.

"Inflation slowdown is overshooting the forecast," the bank said in a statement.

"If the situation develops in line with the baseline forecast, the Bank of Russia will consider the necessity of further key rate reduction in the first half of 2020."

Inflation slowed to 3.4 per cent as of December 9, the bank said. The central bank said it expected inflation to range between 2.9 per cent and 3.2 per cent at the end of the year.

"Policymakers will probably want to see just how far inflation falls in early 2020," Capital Economics said in a note.

"With inflation falling to 3.5 per cent in November (below the 4 per cent target) and likely to drop further in the coming months, we think another 25bp cut at the next meeting,

to 6.00 per cent, is more likely than not."