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 April 2012 the Board of Directors of the Bank of Russia decided to maintain the refinancing rate and the interest rates on the Bank of Russia operations unchanged (table “Interest rates on the Bank of Russia operations”).
The decision was supported by the assessment of inflation risks and economic growth prospects.
In March inflation rate remained low — at 3.7% over a year ago, while core inflation rate declined to 5.5%. This tendency is expected to be short-term. Medium-term inflation risks are amplified by the uncertainty surrounding the scale of influence on consumer prices of an increase in the majority of regulated prices and tariffs planned for July.
The dynamics of a number of macroeconomic indicators in February points to an improvement in economic conditions. Industrial production growth accelerated and the growth rate of investment in production capacity in year-over-year terms remained high. The dynamics of real wage and household credit activity as well as the low rate of unemployment provide for the sustainability of consumer demand.
The Board of Directors of the Bank of Russia also decided to set the maximum interest rate on the 1 week deposit auctions at 4.75% per annum starting from 10 April 2012. Adding a short-term market sterilization instrument to the existing toolset of the Bank of Russia will contribute to the reduction of money market interest rates volatility and enhancement of the effectiveness of the interest rate policy.
Considering recent domestic and international macroeconomic developments the Bank of Russia judged that the current level of money market interest rates within the interest rate corridor was appropriate for the coming months. The Bank of Russia will continue to monitor inflation risks and in making monetary policy decisions will rely on medium-term inflation forecasts and the dynamics of inflation expectations.
The next meeting of the Board of Directors on monetary policy issues is planned to be held in the first half of May 2012.
Interest rates on the Bank of Russia operations (% p.a.)
| Purpose | Type of instrument | Instrument | Term | Rate since 26.12.11 |
| Liquidity provision | Standing facilities (fixed rates) | Overnight loans | 1 day | 8.00 |
| FX swaps (rouble rate) | 1 day | 8.00 | ||
| Lombard loans, REPO | 1 day, 1 week1 | 6.25 | ||
| Lombard loans | 30 days2 | 6.25 | ||
| REPO | 12 months2 | 7.75 | ||
| Loans secured by gold | Up to 90 days | 6.75 | ||
| From 91 to 180 days | 7.25 | |||
| From 181 to 365 days | 7.753 | |||
| Loans secured by non-marketable assets and guarantees | Up to 90 days | 7.00 | ||
| From 91 to 180 days | 7.50 | |||
| From 181 to 365 days4 | 8.00 | |||
| Open market operations (minimum interest rates) | REPO auctions | 1 day | 5.25 | |
| Lombard and REPO auctions | 1 week | 5.25 | ||
| 3 months | 6.75 | |||
| 6 months2 | 7.25 | |||
| 12 months4 | 7.75 | |||
| Liquidity absorption | Open market operations (maximum interest rates) | Deposit auctions | 1 week | 4.755 |
| 1 month | 5.50 | |||
| 3 months2 | 6.50 | |||
| Standing facilities (fixed rates) | Deposit operations | 1 day, 1 week, call | 4.00 | |
| Refinancing rate | 8.00 | |||
| 1 1 week fixed rate REPO operations have been suspended. |
| 2 Operations have been suspended. |
| 3 Interest rate has been set since 02.04.2012 |
| 4 Operations have been resumed since 02.04.2012 |
| 5 Interest rate has been set since 10.04.2012 |
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