Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
Executive summary:
- The CBR are expected to keep the key rate unchanged at 7.50%
- Pro-inflationary risks, supply side woes and ongoing war worries keep the Russian economy in an elevated state of uncertainty
- Despite pressure from President Putin and his government to signal readiness to loosen monetary policy, Governor Nabiullina and her colleagues are so far unwilling to alter their neutral stance
The CBR offered little forward monetary guidance in its previous statement but highlighted that the path of policy would be dependent on inflation dynamics as well as developments to external and domestic events. Since then, headline inflation has eased slightly from +12.0% y/y in November to +11.9% y/y in December, falling below the CBR’s forecast for end-2022. The uptick in weekly CPI readings, on the other hand, signal that risks are pro-inflationary and support a hold decision by the CBR.
Bloomberg have recently reported that despite pressure from President Putin and his government to signal readiness to loosen monetary policy, Governor Nabiullina and her colleagues are so far unwilling to alter their neutral stance due to upside risks to inflation, and are instead likely to indicate that rates have little room to fall. The CBR are, however, open to improving forecasts. Though President Putin offered Governor Nabiullina a new five-year term in February 2022 (after she sought to resign following the invasion of Ukraine), the relationship between the government and the independent CBR will be closely watched for further signs of tension as Russia’s war efforts continue to strain the Russian economy.
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.