The recent release of the Summary of the Key Rate Discussion highlights several significant developments in economic conditions and monetary policy. The discussion, which assessed the current economic situation, inflationary pressures, and potential adjustments to the key rate, revealed that some risks noted in a previous meeting had begun to materialize as of October.
Participants identified new proinflationary factors such as a notable rise in recycling fees and certain regulated tariffs. These elements are expected to impact inflation rates through 2024 and 2025. Consequently, an additional tightening of monetary policy was deemed necessary to lower inflation to its target level and curb inflation expectations.
Following this discussion, the Board of Directors decided to increase the key rate to 21.00% per annum. This decision aligns with an updated medium-term forecast that anticipates a significantly higher trajectory for the key rate over 2025–2026. This adjustment aims at stabilizing inflation around a target level close to 4%.
Additionally, alongside the Summary's publication, commentary on the Bank of Russia’s Medium-term Forecast was also made available.