BoR Leaves Rates Unchanged as Inflation Runs Hotter Than Expected

“Russia’s central bank held back from raising interest rates after a surprise increase last month, a pause that may prove brief after inflation quickened past the target range to the fastest in 10 months.

Bank Rossii kept the refinancing rate at 8.25 percent at a meeting today after a quarter-point increase in September, the central bank in Moscow said in a statement on its website. The decision was forecast by 19 of 22 economists in a Bloomberg survey. The main short-term lending and deposit rates will remain at 5.5 percent and 4.25 percent.

While economists project the central bank will raise borrowing costs again before the end of this year, policy makers may delay further increases as they gauge the impact of higher rates on a slowing economy and the government steps up efforts to hold down grain prices. Russia is planning to start sales of wheat from state reserves, with export restrictions remaining in the government toolkit for fighting inflation.”

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