World Economy

Russia CB to Cut Rates

Russia CB  to Cut RatesRussia CB  to Cut Rates

Russia’s central bank will cut its main policy rate for the first time in almost a year when it meets on Friday, a Reuters poll predicted on Monday. The bank has held its key rate at 11% since last reducing it in July 2015, maintaining a cautious stance because of inflationary risks. But 14 out of 23 forecasters said they expected a 50 basis point rate cut at the bank’s meeting as the outlook for inflation had continued to improve. Nine economists thought the bank would leave rates unchanged. Goldman Sachs analysts based their “cut” call on signs inflation in seasonally adjusted terms was already close to the bank’s 4% inflation target for next year. Annual inflation has fallen sharply since the start of the year, though it stabilized at 7.3% in April. Weekly data has improved since. “We doubt any uncertainty about the UK’s EU referendum or the timing of a Fed hike would deter the CBR,” Goldman Sachs wrote in a note to clients.