The Russian central bank decided to maintain its benchmark interest rate at 21% to combat inflation, which reached 9.5% in 2024. This decision follows a significant rate hike in October, which has faced criticism from businesses for stifling economic growth.
The bank raised its inflation forecast for 2025 to 7.0–8.0%, expecting inflation to return to its 4.0% target by 2026. The bank also increased its 2025 growth forecast to 1.0–2.0%. The rouble has strengthened by about 20% this year, boosted by optimism over U.S.-Russia talks, which may help reduce inflation.
Despite optimism in the market following a call between U.S. President Donald Trump and Russian President Vladimir Putin, the central bank stated that it was premature to factor in a potential peaceful settlement in Ukraine.
