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Russian central bank confounds forecasts with interest rate cut

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Russian central bank confounds forecasts with interest rate cut
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Russia has moved to lower interest rates and boost growth as its financial pressures ease, with a fall in inflation reassuring policymakers.

The cut is only a small one, a quarter of one percent to 9.75%, but it bucked the forecasts and may be part of efforts to devalue the rouble, which had firmed ahead of the central bank meeting.

Several officials have recently been claiming the Russian currency is overvalued.

The central bank added it did not rule out further progressive cuts in the next two quarters
as inflation looked more likely to hit the targeted 4% by the end of the year.

The bank insists it will maintain a “moderately tight” monetary policy in the medium term to forestall the risk of inflation climbing again.