- Decision
- Lower
- Rate change
- 50 bps
- key rate
- 15.5%
The Bank of Russia cut its key rate by 50 bp to 15.50 % on 13 February 2026, judging that the economy is moving back toward balanced growth and that January’s spike in headline inflation—driven by higher VAT, excise and administered prices plus fruit-and-vegetable adjustments—was largely one-off, with underlying price pressures little changed and expected disinflation ahead. Including this move, the policy rate has been lowered by a cumulative 550 bp since June 2025 as the central bank gradually retreats from last year’s emergency peak. Monetary conditions have eased—credit and deposit rates are down—yet remain restrictive, with money-market rates and OFZ yields broadly stable in real terms and non-price lending standards still tight. Seasonally adjusted price growth slowed to 3.9 % annualised in 2025 Q4 from 6.5 % in Q3, while annual inflation was 6.3 % on 9 February after ending 2025 at 5.6 %; the Bank now sees 2026 inflation at 4.5–5.5 % and underlying inflation near 4 % in H2 2026. GDP rose 1.0 % in 2025, at the top of the prior forecast range, but domestic demand and labour-market tightness are easing, though unemployment remains at historic lows and wage growth still exceeds productivity. The central bank warns that pro-inflationary risks from elevated expectations, tax-related price effects and weaker external trade outweigh disinflationary forces, while global growth uncertainties, trade disputes, low oil prices and geopolitical tensions add to volatility. It will judge the need for further cuts at upcoming meetings, maintaining that an average key rate of 13.5–14.5 % this year will keep policy firmly tight until inflation returns to target in 2027.
Rate evolution
From June 2025 to July 2026, the Bank of Russia lowered the key rate by 600 basis points to 14.00%, with 300 basis points of easing delivered in June and July 2025, smaller cuts thereafter as disinflation became uneven, and successive 25 basis point reductions on 19 June and 24 July 2026. Early decisions cited falling underlying inflation, slowing domestic demand and the economy’s return to a balanced growth path, although monetary conditions remained tight, the labour market stayed tight and inflation expectations remained elevated. Through late 2025, cuts slowed as underlying price growth stayed above 4%, lending accelerated, and one-off moves in tariffs, fuel, fruit and vegetables, value added tax and administered prices clouded the signal, while the Bank’s risk framing hardened from slightly reduced but still prevailing proinflationary risks to increased proinflationary risks in October.
The June and July 2026 cuts reflected moderate economic growth after a temporary decline at the beginning of the year, slower current price growth in April and May, and average price growth of 5.0% in annualised terms in the second quarter, but the Bank noted that underlying inflation remained at 4–5%, inflation expectations had increased and wage growth continued to outpace productivity. On 24 July, it said a smoother key rate decrease was required because of the direct and second-round effects of temporary production capacity shutdowns in certain sectors and more expansionary fiscal policy over the three-year horizon than projected in April. On 11 September, the Bank held the key rate at 14.00% as current price pressures increased significantly, underlying price growth accelerated to 5–6% primarily because of a temporary reduction in production capacities in certain sectors, annual inflation reached 6.3% on 7 September and proinflationary risks increased, while it maintained that further decisions would depend on inflation, inflation expectations and risks from domestic and external conditions.