Central Bank Of Russia Raised The Policy Rate More Than Expectations

The Central Bank of Russia raised the policy rate to 5 percent, which was much more than market expectations.

The Central Bank of Russia increased the policy rate above expectations. The bank increased the policy rate by 50 basis points to 5 percent. Economists, who participated in the survey prepared by Bloomberg, expected the interest rate increase by 25 basis points. A knowledgeable source, who previously made a statement to Bloomberg, stated that the Russian Central Bank will act faster than the previous signals about tightening the monetary policy. Accordingly, the bank may increase its policy rate by 125 basis points or more until the end of the year. A source who wanted to stay anonymous because the discussions on the issue were not public, told Bloomberg that the rise in inflation in the country and concerns about the government's plans to increase public spending could mean that the Russian Central Bank can raise the policy rate to 5.5 percent or 6 percent in a few steps