Monetary conditions do not change significantly in July
The Bank of Russia’s decision to cut the key rate to 8% will help ease monetary conditions during several months as macroeconomic stabilisation continues. This information is given in the Bank of Russia’s commentary Monetary Conditions and Monetary Policy Transmission Mechanism.
Short- and medium-term money and debt market rates declined as monetary policy was eased further. Long-term rates remained almost unchanged amid persistent geopolitical and sanction risks.
In July, the inflow of household funds into banks continued mainly due to the growth of current ruble accounts. Lending was supported by a reduction in credit rates and an improvement in households’ and businesses’ sentiment owing to the stabilisation of macroeconomic conditions.
By the end of July, the ruble adjusted to 62 rubles against the US dollar. The ruble weakening was a factor of the easing of monetary conditions in the economy, contributing to an increase in export and budget revenues.
This material, describing the monetary policy transmission mechanism in more detail, will be published from August 2022 instead of the information and analytical commentary Banking Sector Liquidity and Financial Markets: Facts, Assessments and Comments.