America News Agency

The report states: “The most likely scenario is a reduction of the interest rate to 16% by the end of 2025. With inflation projected at around 7-8%, the real interest rate would be about 9-10%, maintaining a tight monetary policy.”

Analysts believe that lowering the key rate to 16% will not lead to a significant rise in inflation and does not necessarily mean a sharp weakening of the ruble.

At the same time, as experts note, the business community suggests a more decisive cut to 12% to stimulate economic activity.

The report’s authors caution that “such a move entails risks of recession and increasing inflationary pressures due to the growth of activity in the credit and consumer segments.”

According to experts, to minimize the risk of a sudden rate cut, the Central Bank of Russia should start with a 2-point decrease in July 2025 and then “pause to assess macroeconomic indicators” before initiating a gradual easing cycle.

On June 6, the Central Bank of the Russian Federation reduced the key interest rate for the first time in nearly three years (since September 2022) from a record high of 21% to 20% annually.

The interest rate in Russia has remained at a historical peak for more than seven months since the end of October last year. Meanwhile, the Central Bank has taken a neutral stance and has not indicated a direction for its next steps: decisions will depend on the pace and sustainability of inflation reduction and inflation expectations.

The next meeting of the Central Bank of Russia on the interest rate is scheduled for today.

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