Monetary conditions remained neutral in October
Monetary conditions tightened somewhat in October, but overall remained neutral. Their tightening was associated with higher public debt market yields in late September amid ongoing geopolitical tensions.
Another reason for the tightening was that bank deposit rates rose slightly in response to increased households’ demand for cash. This can be found in the Bank of Russia’s information and analytical commentary Monetary Conditions and Monetary Policy Transmission Mechanism for October.
Money market and debt market yields fell slightly over the month, but their average level in October was higher than in September. The decision of the Bank of Russia Board of Directors made on 28 October to keep the key rate at 7.5% p.a. was in line with market expectations.
Corporate lending and mortgage growth accelerated in September following more accommodative lending conditions in the third quarter. The high-frequency data point to a slowdown in retail lending in October.