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CBR Unexpectedly Raises Rates by 100bps to 8.50%

CBR

The Central Bank of Russia raises rates by 100bps to 8.50%, a larger hike than the expected 50bps move.

Full statement here: https://www.cbr.ru/eng/press/pr/?file=21072023_133000Key_eng.htm
Highlights:

  • Proinflationary risks have increased significantly over the medium-term horizon.
  • High and unanchored inflation expectations, which are particularly sensitive to exchange rate fluctuations, are also a source of risk.
  • In case of a further expansion in the budget deficit, proinflationary risks will increase and tighter monetary policy may be required to return inflation to target in 2024 and keep it close to 4% further on.
  • The Bank of Russia holds open the prospect of further key rate increase at its next meetings to stabilise inflation close to 4% in 2024 and further on.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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