Putin: the reduction of the key rate of the Central Bank will allow to launch new investment projects

a Reduction by the Bank of Russia key rate will provide new opportunities for the implementation of investproektov, the development of mortgage lending. This was stated by Russian President Vladimir Putin.

“the economy is a new opportunity for new investment and infrastructure projects. For entrepreneurs — loans to expand their business. And for the citizens — more affordable loans for the purchase of new housing,” — said the President.

the President called the policy of the Central Bank to reduce the key rate consistent. The reduction in the rate to 4.5% was a historic low. Such a low level is reached for the first time since then, as the key rate introduced by the Bank of Russia 13 September 2013 as the main indicator of monetary policy.

After a surge in prices in March-April, inflation is back to normal, and even expected quicker slower price growth than projected. At the end of the year inflation may be below 4%, said the Central Bank.

This allows to lower the rate more strongly. At the previous meeting of the Board of Directors of the Bank of Russia on 24 April the key rate was reduced from 6% to 5.5%. At the previous meeting on 20 March, the Central Bank kept its key rate at 6%. Prior to the announcement in the world of the pandemic, the Bank of Russia on 7 February 2020, has reduced the key rate by 0.25% to 6% per annum.

Sberbank predicts the reduction of the key rate of the Central Bank to 4% by the end of September. Investment Bank Goldman Sachs expects a gradual decline in Bank of Russia key rate to 3.5%.