Bank of Russia updates approaches to holding fine-tuning auctions
From 13 May 2026, which is the first day of the May required reserve averaging period, the Bank of Russia will adjust the approaches to holding fine-tuning auctions. The decision aims to enhance the efficiency of the monetary policy operational procedure and reduce the average deviation of money market rates from the key rate.
In the course of fine-tuning auctions, the Bank of Russia will take into account not only the banking sector’s need for liquidity, but also the observed deviation of RUONIA from the key rate (spread). In case the spread is steady and considerable, fine-tuning auctions may be held more frequently. Nevertheless, as banks adapt to the new approach and their expectations about future RUONIA dynamics and the key rate level converge, the need for these operations will be declining.
In the event of a fine-tuning deposit auction, the Bank of Russia will set the limit depending on the total amount of excess liquidity in banks’ accounts with the Bank of Russia.
On the last day of the averaging period when the mechanism of required reserve averaging does not allow banks to fully offset temporary imbalances between the demand for liquidity and its supply, the Bank of Russia will continue holding fine-tuning auctions to limit fluctuations in money market rates, in line with the existing practice.