The Board of Directors of Russia's Central Bank has kept the key interest rate at 21% and updated its macroeconomic forecast, indicating high inflationary pressure.
Amid the Russia-Ukraine war and the continued Western sanctions, the Central Bank's forecasts for improving economic indicators by 2026 are primarily political in nature.
The Central Bank of Russia has raised its inflation forecast for 2025 from the previously expected 4.5–5% (as predicted in October 2024) to 7–8%.
For the average key interest rate in 2025, the forecast has worsened from 17–20% to 19–22%, and for 2026—from 12–13% to 13–14%. The 2027 rate forecast remains at 7.5–8.5%.
Conditions for lowering the key interest rate may arise no earlier than the second half of 2025 if inflationary pressures slow down. In this scenario, the rate could only drop to 18–19% by the end of 2026.
The Central Bank acknowledges the high inflationary pressure, which prevents lowering the key interest rate. The worsening inflation and average refinancing rate forecasts for 2025 indicate deepening economic imbalances in Russia.
