MOSCOW (Reuters) -The Russian central bank will cut its benchmark interest rate by one percentage point to 19% at its board meeting on July 25 as inflation is expected to be within its estimated range in 2025, a Reuters poll of 12 economists showed on Tuesday.
Economists saw full-year inflation at a median of 7%, down from 9.9% earlier, as the central bank’s tight monetary policy puts the brakes on economic growth, which was estimated to fall to a median view of 1.5% in 2025 compared with 4.3% last year.
“We are moving in the right direction with inflation, and therefore our forecast is that we are entering a rate-cutting cycle,” said VTB investment strategist Alexei Kornilov.
The central bank surprised markets last month when it had cut the key interest rate by a full percentage point to 20% pointing to declining inflation pressure and a more robust rouble.
Economists’ 1.5% projection for growth in 2025 is unchanged from last month. The rouble was seen at 98.25 against the U.S. dollar in 12 months, weaker than 97.5 per the dollar in the previous poll.
(Reporting by Elena Fabrichnaya and Gleb Bryanski; Editing by Hugh Lawson)
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