Bank of Russia cuts key rate by 50 bp to 15.00%

The Bank of Russia lowered its key rate by 50 bp to 15.00% per annum, saying the economy is moving towards a balanced growth path while February data confirmed a predictable easing in price pressures, with underlying inflation running at an annualised 4–5 % and headline inflation at 5.9 % as of 16 March. After cumulative cuts of 600 bp since March 2025, monetary conditions have softened yet remain tight, with market rates down, non-price lending terms still restrictive and lending growth only moderate amid a continued household preference for saving. Seasonally adjusted price growth averaged 10.2 % annualised in January-February versus 4.4 % in 2025 Q4 but slowed markedly in February as one-offs faded; the central bank still projects headline inflation at 4.5–5.5 % this year and core inflation near 4 % in H2. High-frequency indicators show cooling consumer demand and softer business sentiment, while labour shortages and wage indexations are easing even though unemployment stays at historic lows and wage growth exceeds productivity. The authorities flag heightened external uncertainty, citing a weaker global outlook, broader price pressures and rising geopolitical tensions as key pro-inflation risks, which continue to outweigh disinflationary forces. The Board will decide on further rate cuts after assessing the durability of the inflation slowdown, shifts in inflation expectations and the balance of external and domestic risks, noting that fiscal policy should aid disinflatio