Big business lobby RSPP expects CBR to cut key rate to 18% in July

YEKATERINBURG. July 7 (Interfax) - The Russian Union of Industrialists and Entrepreneurs (RSPP) expects the Central Bank of Russia (CBR) to make a bolder move on its key interest rate in July than it did in June and cut it by 200 basis points to 18% from the current 20%, the lobby group's president, Alexander Shokhin told Interfax.

"We expect 18%. There's no point [cutting] by one percentage point, actually. Alternatively, one needs to risk and see how this affects business activity, inflation and so on," Shokhin said on the sidelines of the Innoprom-2025 exhibition.

He recalled that the RSPP earlier said it would like to see the CBR lower the rate to 18% by September. Given that August is holiday season, it would make sense to already make the decision on the rate in July, he said.

The CBR cut the rate from 21% to 20% in June, but a more modest reduction of 50 basis points was also discussed at its board meeting. The next CBR board meeting will be held on July 25.

An advisor to the CBR governor, Kirill Tremasov told reporters last week that the CBR will consider lowering the rate by 100 basis points or more in July and that a smaller cut than the one made in June will not be on the table.