Summary of the Key Rate Discussion released
The publication covers the main aspects of the discussion about the economic situation and inflation, monetary and external conditions, and alternatives to the key rate decision.
The participants in the discussion pointed out that monetary conditions tightened to a greater extent than assumed in October. If the existing tightness of monetary conditions remained unchanged, growth in lending and aggregate demand in 2025 might slow down more rapidly than assumed in the October forecast of the Bank of Russia. This would help curb growth in prices and lower inflation expectations even given the mounting inflationary pressures over the recent months.
Due to the considerable slowdown in the growth of lending, it was decided to take a break and assess whether these changes were robust and how quickly they would impact price dynamics. The participants noted that if lending resumed growing at an elevated rate and inflation trends did not reverse by the Bank of Russia Board of Directors meeting scheduled for February 2024, the regulator would have to consider the option of raising the key rate further.
Following the discussion, the Board of Directors kept the key rate at 21.00% per annum.