The central bank cut its key interest rate to 10.5% – Business Petersburg

For the first time since August, the central bank decided on a policy easing and lowered its key interest rate from 11 to 10.5%. The regulator made a choice in favor of stimulating the economy, which, according to him, is already less dependent on the commodity markets, but still afraid of inflation acceleration. The banking sector, key rate, the Central Bank

at the end of the RF Central Bank meeting on Friday , June 10, the key rate decreased to 10.5% from the level of 11%, where it was in August 2015. Thus, the Central Bank for the first six months decided to mitigate credit policies.

The reason for easing given inflation. From May 31 to June 6, Russia for the first time since the beginning of the year recorded zero inflation week, Rosstat data show. In annual terms, inflation, as of June 6 was 7.2%. In May, inflation was 7.3%, which is the same as in April, that is, the burst of inflation, the dangers of which the Central Bank said after a meeting on 29 April did not happen. Monthly inflation seasonally adjusted amounted to about 5% in annual terms. Forecast control became more optimistic and was reduced at the end of 2016 to 5-6%. Annual inflation is less than 5% in May 2017 and will reach the target level of 4% at the end of 2017, according to the Central Bank.

The growth of prices holding back a stable situation on the the foreign exchange market, which is provided relatively high oil prices. At the end of May, Brent over $ 50, and on 8 June even managed to pass for $ 52. Nevertheless, the great confidence in the growth of the report of the Central Bank of the question, the regulator notes rather increase the stability of the Russian economy to fluctuations in the commodities market.

Source: CBR

In addition, the central bank has realized the urgent need to stimulate the economy , and is concerned about the negative the dynamics of investment, which, by the way, there is also because of the tough policy, which is not changed more than six months. “There has been stagnating for quite a wide range of industries, including those that have traditionally been sources of growth of the Russian economy, however positive developments in the economy is approaching its entry into the recovery phase -. Quarterly GDP growth is expected no later than the second half of this year”, – consider in the Central Bank. According to the forecast the regulator, GDP will grow by 1.3% in 2017, followed by the low annual rate of output growth in the following years, the goods and services remain. This prediction is made on the basis of a rather conservative estimation of the average annual price of oil -. About $ 40 per barrel in the three-year term

In this case the CB still fears a sharp acceleration of inflation and the risk of does not reach the target level of 4% in 2017. This fear is due to the inertia of inflation expectations, uncertainty with the budgetary strategy, namely to further the indexation of salaries and pensions. “The negative impact on the exchange rate and inflation expectations may have and volatility of global commodity and financial markets, these risks may cause the deceleration of inflation reduction process.” – CB maintains a cautious attitude. “To target of 4% of the Central Bank can approach close, provided that commodity markets will not return to the depressed state of the beginning of the year”, – says the analyst of Nordea Bank Denis Davydov

The key rate cut was a way out. negative statistics on the US labor market, resulting in the likelihood of higher interest rates in the US declined significantly, assured the chief economist at Alfa B Anka Natalia Orlova. “This is supported by the oil market and improve the dynamics of the ruble, which allowed the Central Bank to carry out a sufficiently strong decrease in the rate”, – she says. Recall, the official report of the US Department of Labor, published June 3 showed that job growth in the country in May was only 38 thousand. Vs. 158 thousand. The market took these figures as the destroying the opportunity for the US Federal Reserve to make raising the key rate at the meeting of 15 of June.

In the current Central Bank conditions could be even more decisive and to lower the rate to 10%, but would prefer to be more cautious at the same time maintaining the positive trends will give him a reason at the next meeting again lower the rate, says the analyst CC “Finam” Bogdan Zvarich. “As for the dynamics of the rate until the end of the year, then, in my opinion, taking into account trends in the energy market, including oil prices stabilize at around $ 50-55 per barrel, it is possible that the Central Bank will be able to lower the rate to 8-9 % “, – predicts analyst

.” The symbolic lowering of rates (50 bps) will not have any pressure on the stability of the macroeconomic situation, but it will provide additional incentives to commercial banks to soften credit policy, which in the future should support investment and to expedite the return of the economy to grow, – says the director of the territorial “BCS Premier” Vadim Isakov -. in our view, given the trends, there is a potential to reduce the key rate before the end of the year to 9-9.5% , reducing the stages there may be two or three. that is, no sudden movements bet we do not expect “.

” By the end of the year we are waiting for a further reduction in the rate at 0,5% Russian Central Bank, if the Fed decides to tighten monetary policy in the United States in the fall, which may cause the return of the trend of strengthening of the dollar, and two drops if the US regulator to postpone the tightening in 2017 – says financial analyst “Dohod” Vladimir Kiselyov. – Care of the Central Bank of Russia to reduce rates caused by the firm intention to continue to slow inflation, sacrificing the current level of business activity. According to forecasts of the regulator for the year ahead, the growth of consumer prices should be less than 5%. The rating is made while waiting for oil prices of $ 40 per barrel, so looks too optimistic. If the price per barrel will rise to the level of $ 60, in achieving targets of the Central Bank, nothing is impossible. “

The current decision of the Bank of Russia in the rate was a small market, but it’s still a surprise : before that forecasts have not been unambiguous Therefore, the dollar fell against the ruble at 13:00 the pair traded near the 64.55 mark, and immediately at the output of the Central Bank of posts she reached 64.14 but then, the currency has stabilized, according to the 15:00… , the dollar was trading at around $ 64.4, so can be called a neutral reaction of the ruble as a whole: reduced rates of the Central bank was included in the quotes before the

it is interesting that the largest Russian banks, in. particularly Sberbank and VTB, announced the reduction of interest rates on loans to small businesses at the end of May, without waiting for the outcome of the meeting of the Central Bank.

The next meeting of the Board of Directors Bank of Russia, which will be considered the level of the key rate, scheduled for July 29, 2016.