Expert sees key rate likely remaining at 14.5%

NOVOSIBIRSK, June 18. /TASS/. The Bank of Russia is more likely to keep its key interest rate unchanged at 14.5%, while even a 50-basis-point cut appears less probable, Eduard Kolozhvari, Candidate of Economic Sciences and head of the Higher School of Business at Novosibirsk State University of Economics and Management, told TASS.

The Bank of Russia's board of directors will consider the key rate at its next meeting on June 19.

"The macroeconomic environment and geopolitics, particularly the situation in the Persian Gulf, are not conducive to monetary easing anywhere in the world. Against this backdrop, I believe our regulator will avoid excessive easing of monetary policy and will most likely leave the rate unchanged. My probability estimate would be: 50% for keeping the rate unchanged, 30% for a 50-basis-point cut, and 20% for a 100-basis-point cut," the expert said.

At the same time, he noted that the market expects the Central Bank to maintain its gradual easing trajectory, taking into account a certain slowdown in inflation. Several sectors of the economy have called for a rate reduction of 100 basis points or more. However, in the expert's view, no significant reduction should be expected.

"Monetary policy is tightening worldwide, inflation risks are increasing, and the ruble remains strong. I believe the current level of tightness will continue," he added. He also pointed out that the Bank of Russia's baseline scenario for 2026 envisages an average key rate within a range of 14.0% to 14.5% per annum.

The Central Bank began gradually lowering the key rate in June 2025, when it reduced the benchmark rate from 21% to 20% per annum. By the end of the year, the rate had declined to 16%. Since February of this year, the Bank of Russia has cut the rate by 50 basis points at each meeting - to 15.5% in February, 15% in March, and 14.5% in April.