The Central Bank cut its key rate to 6.25%

The Central Bank of Russia for the fifth time in 2019 lowered the key rate, now it is 6.25%. This was announced at the last meeting of the Bank of Russia this year. 

The key rate is the minimum interest rate at which the Central Bank provides loans to commercial banks for a week and at which it is ready to accept funds for deposits. Its size directly affects inflation and consumer demand for credit products.

"The easing of monetary policy by the Central Bank will have a positive impact on the growth opportunities of small and medium-sized businesses, as it will allow attracting cheaper loans and other financial support measures. In the context of lower inflation, the savings achieved by SMEs by reducing the volume of interest payments will allow more investment in the business. This is especially true for start-UPS, which will thus be able to quickly reach full payback and net profit, and companies with experience that were preparing to scale or enter new markets and planned to attract loans, " said economy Minister Farid Abdulganiev.

As noted in the Central Bank, at the moment there is a slowdown in inflation, and the pace of this slowdown is increasing and has already exceeded the expected forecasts. However, according to the regulator, it is still difficult to assess their stability. The Bank of Russia is considering further reduction of the key rate in the first half of 2020.