EXCLUSIVE-Russia central bank will consider rate cut next week, deputy governor says

Credit: REUTERS/SERGEI KARPUKHIN

Russia's central bank will consider a cutting interest rates next week, but it's already used much of its room to ease policy and foresees limits to what it can do in the future, Deputy Governor Alexei Zabotkin told Reuters.

By Elena Fabrichnaya

MOSCOW, July 16 (Reuters) - Russia's central bank will consider a cutting interest rates next week, but it's already used much of its room to ease policy and foresees limits to what it can do in the future, Deputy Governor Alexei Zabotkin told Reuters.

The central bank slashed its key rate by 100 basis points, the most in five years, to a record low of 4.5% at its last meeting. It was the third rate cut this year as it coped with a contracting economy and low inflation.

Although the bank sees a "significant risk" inflation will remain below its 4% target next year, Zabotkin said further policy easing is likely to be more gradual. The key rate was at 6.25% at the start of this year.

"Most likely the further pace of a cut will be more gradual given that the significant part of a room for easing was already used," he said. The central bank's board is due to meet on July 24 for its next key rate setting decision.

(Reporting by Elena Fabrichnaya, writing by Katya Golubkova, editing by Larry King)

((ekaterina.golubkova@thomsonreuters.com; +7 495 775 1242;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More