The Board of Directors’ Decision on the Bank of Russia Interest Rates (Unofficial translation)
The Bank of Russia External and Public Relations Department informs that on 9 August 2013 the Board of Directors of the Bank of Russia decided to maintain unchanged the interest rates on the Bank of Russia operations and the refinancing rate (table “Interest rates on the Bank of Russia operations”).
The decision was based on the assessment of inflation risks and economic growth prospects.
In July and at the beginning of August the rate of inflation declined, but remained above the target range and as of 5 August 2013 was estimated at 6.5% over a year ago. The inflation deceleration was mainly attributed to food prices dynamics. Meanwhile, the growth rate of prices for nonfood products and services with the exception of regulated prices and tariffs also declined. Core inflation slid to 5.6% in July. According to the Bank of Russia estimates, there is no significant demand side inflationary pressure, as gross output stands slightly below its potential level. Assuming unchanged monetary policy stance and absence of adverse food prices shocks, the Bank of Russia expects that the rate of inflation will get back to the target range during the second half of 2013 and will continue declining in 2014. However, in order to achieve inflation target in the medium term favorable trends in the dynamics of inflation expectations should be sustainable.
The dynamics of the key macroeconomic indicators points out that the pace of economic growth remains low. The growth rates of industrial production remain subdued, investment in production capacity continues to decrease. In this environment some increase in the unemployment rate was recorded in recent months. Consumer demand supported by the real wage and retail lending growth remains the major driver for the economic growth. Weak investment activity combined with the sluggish recovery in external demand points out to persisting risks of further economic slowdown, also in the medium term perspective.
The Bank of Russia will continue to monitor inflation risks and the downside risks to economic growth. In making monetary policy decisions the Bank of Russia will be guided by the inflation goals and economic growth prospects.
The next meeting of the Board of Directors of the Bank of Russia on monetary policy issues is planned to be held on 13 September 2013.
Interest rates on the Bank of Russia operations
(% p.a.)
| Purpose | Type of instrument | Instrument | Term | Rate since 11.06.13 |
| Liquidity provision | Standing facilities (fixed rates) | Overnight loans | 1 day | 8.25 |
| FX swaps (rouble rate) | 1 day | 6.50 | ||
| Lombard loans, REPO | 1 day, 1 week1 | 6.50 | ||
| Lombard loans | 30 days1 | 6.50 | ||
| REPO | 12 months1 | 7.25 | ||
| Loans secured by gold | Up to 90 days | 6.50 | ||
| From 91 to 180 days | 7.00 | |||
| From 181 to 365 days | 7.25 | |||
| Loans secured by non-marketable assets and guarantees | Up to 90 days | 6.75 | ||
| From 91 to 180 days | 7.25 | |||
| From 181 to 365 days | 7.50 | |||
| Open market operations (minimum interest rates) | REPO auctions | 1 day | 5.50 | |
| Loans secured by non-marketable assets and guarantees, auctions | 12 months | 5.752 | ||
| Lombard and REPO auctions | 1 week | 5.50 | ||
| 3 months | 6.50 | |||
| 6 months1 | 7.00 | |||
| 12 months | 7.25 | |||
| Liquidity absorption | Open market operations (maximum interest rates) | Deposit auctions | 1 week | 5.00 |
| 1 month1 | 5.75 | |||
| 3 months1 | 6.50 | |||
| Standing facilities (fixed rates) | Deposit operations | 1 day, 1 week1, 1 month, call | 4.50 | |
| For reference: | ||||
| Refinancing rate | 8.25 | |||
1 Operations have been suspended.
2 Interest rate has been set since 15.07.2013.
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