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 5 October 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 September the pace of inflation continued to rise and reached 6.6% over a year ago, which exceeds the inflation target range. Price growth acceleration observed in recent months is mainly attributed to the food price dynamics and the increase in the regulated prices and tariffs. However, the continued increase in the core inflation rate implies that inflation is spreading to other consumer market segments, while, according to the Bank of Russia estimates, significant demand-pull price pressures are absent.
The dynamics of the key macroeconomic indicators in August pointed to a certain slowdown in economic activity, reflected in slower industrial production growth as well as lower investment and consumer demand growth rates. However, employment and economic confidence indicators on the whole didn’t exhibit deterioration in August-September. Labour market conditions together with credit expansion support robust domestic demand. According to the Bank of Russia estimates, gross output remains close to its potential level.
There are certain signs of the stabilization of the banking credit growth. However, the Bank of Russia judges that currently the risks of a significant economic slowdown stemming from somewhat tighter monetary conditions are minor.
The Bank of Russia will continue to monitor inflation risks, including global food price dynamics, global economic developments and the consequences of the monetary conditions tightening for the Russian economy. In making monetary policy decisions the Bank of Russia will be guided by medium-term inflation goals and economic growth prospects, as well as the dynamics of inflation expectations.
The next meeting of the Board of Directors of the Bank of Russia on monetary policy issues is planned to be held in the first decade of November 2012.
Interest rates on the Bank of Russia
operations
(%
p.a.)
| Purpose | Type of instrument | Instrument | Term |
Rate since 14.09.12 |
| Liquidity provision | Standing facilities (fixed rates) | Overnight loans | 1 day | 8.25 |
| FX swaps (rouble rate) | 1 day | 6.75 | ||
| Lombard loans, REPO | 1 day, 1 week1 | 6.50 | ||
| Lombard loans | 30 days1 | 6.50 | ||
| REPO | 12 months1 | 8.00 | ||
| Loans secured by gold | Up to 90 days | 7.00 | ||
| From 91 to 180 days | 7.50 | |||
| From 181 to 365 days | 8.00 | |||
| Loans secured by non-marketable assets and guarantees | Up to 90 days | 7.25 | ||
| From 91 to 180 days | 7.75 | |||
| From 181 to 365 days | 8.25 | |||
| Open market operations (minimum interest rates) | REPO auctions | 1 day | 5.50 | |
| Lombard and REPO auctions | 1 week | 5.50 | ||
| 3 months | 7.00 | |||
| 6 months1 | 7.50 | |||
| 12 months | 8.00 | |||
| Liquidity absorption | Open market operations (maximum interest rates) | Deposit auctions | 1 week | 5.00 |
| 1 month1 | 5.75 | |||
| 3 months1 | 6.75 | |||
| Standing facilities (fixed rates) | Deposit operations | 1 day, 1 week1, 1 month, call | 4.25 | |
| For reference: | ||||
| Refinancing rate | 8.25 | |||
1 Operations have been suspended.
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