Ruble Strengthens as Central Bank Holds Key Rate at 15.5%

CBR Policy Decision

The Central Bank of Russia has maintained its key interest rate at 15.5%, in line with market expectations. The decision reflects the CBR's cautious approach to balancing inflation control with economic growth.

Market Reaction

• USD/RUB fell 1.24% to 77.19 on the announcement
• MOEX index rallied 0.87% on monetary stability signals
• Government bond yields declined across the curve

Inflation Outlook

The CBR noted that inflationary pressures are gradually easing, with annual CPI trending toward the 5-6% range. However, the bank emphasized that premature easing could reignite price pressures.

The current rate level is necessary to ensure sustainable return of inflation to the 4% target. - CBR Statement

Analysts expect the first rate cut no earlier than Q3 2026, contingent on continued disinflation.