Inflation expectations in Russia subsided after the central bank signalled last week that further rate cuts were unlikely this year, the bank’s governor Elvira Nabiullina told CNBC in an interview. The central bank cut its key rate by 50 basis points to 10 percent last week, only its second cut so far this year. It is aiming to bring inflation down to 4 percent by the end of next year.
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“We wanted to tell market players about our position that the trajectory of the reduction of the key rate is going to be aimed precisely at achieving our inflation target,” Nabiullina said, according to a transcript of the interview provided by CNBC.
Nabiullina added problems related to Russian economic growth were not determined by the level of the country’s key rate but rather were rooted in structural limitations.