MOSCOW, June 6 (Xinhua) -- The Russian Central Bank cut its key interest rate by 100 basis points to 20 percent as inflation pressures decline, it said in a statement Friday.
The bank said that current inflationary pressures were gradually easing, noting however that domestic demand was "still outstripping the capabilities to expand the supply of goods and services."
To return inflation to its 4 percent target in 2026, the bank said, it would maintain tight monetary conditions for as long as necessary.
"We are close to a scenario of balanced rates of economic growth," Russian Central Bank Governor Elvira Nabiullina said at a press conference.
Nabiullina said there are currently no signs the economy was "overcooling," noting that inflation is still higher than the target, and unemployment remains low.
"Our task is to make sure that the trajectory of the slowdown in growth rates is smooth, so that we move to a situation where we have both stable low inflation and stable rates of economic growth," she said.
Meanwhile, Russia's largest bank Sberbank announced it will lower rates on its main deposits by 1 percentage point to a maximum of 19 percent per annum for all terms from June 11.
The central bank had maintained its key interest rate at 21 percent since Oct. 25, 2024. It will hold its next key rate meeting on July 25. ■
