Russia lowers prime interest rate to 17%

In the notice sent out by Central Bank of Russiathe decision to reduce interest rates by 3 percentage points from 20% to 17% reflects a change in the balance of risks from factors such as rapidly increasing consumer prices, economic slowdown and financial stability risks. .

The above decision was greatly supported by the Ruble fully recovered. The current exchange rate is 79 – 80 rubles to 1 USD, a sharp increase from the new 140 – 150 rubles for 1 greenback – the time when the West applied a series of sanctions related to Russia’s special military campaign. in Ukraine.

Besides, people can buy and sell foreign currencies from April 18 with a limit of no more than 10,000 USD.

“A stable ruble will help keep prices from going up again. Now I can buy my favorite dress for 1,500 rubles. Before the price was raised to 4,000 rubles,” said Anastasia – a Russian resident.

GS. Yuri Yudenkov – Russian Academy of Presidents and Administration said: “In general, the move to lower interest rates is reasonable at this time. The ruble is regaining its position. Hungary is ready to buy gas with rubles. So is Bulgaria. Ruble payments will become more popular in the near future.”

Experts also believe that Russia’s interest rates will drop to 11-12% by the end of this year due to pressures from inflation and a slowing economy. Currently, inflation in March 2022 reached 16.7% – the highest level since 2015. It is forecasted that consumer prices will peak at 24% this summer.

Meanwhile, the 5th rounds of sanctions are continuously being launched by the US, UK and EU. The latest updated report of the World Bank (WB) predicts that Russia’s Gross Domestic Product (GDP) will decrease by 11.2% this year.

And the Institute of International Finance said that Russia’s GDP this year will decrease by 15%, erasing 15 years of growth. Unemployment doubled to 8%.

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