Central Bank of Russia leaves key rates on hold
MOSCOW. May 15 (Interfax) - Directors at the Central Bank of Russia decided at a meeting on May 15 to leave the refinancing rate, which is 8.25% pa, and other key rates on hold, effective May 16, the Central Bank said in a statement.
However, rates for some long-term operations were lowered a quarter-percent.
"The decision was supported by the assessment of inflation risks and economic growth prospects. The cut in the interest rates on longer-term liquidity provision operations brings the cost of obtaining liquidity from the Bank of Russia by credit institutions closer to the interest rates on the Bank of Russia main liquidity provision operations, which will contribute to strengthening the interest rate channel of the monetary policy transmission mechanism," the Central Bank said in a comment to the decision.
"In April and at the beginning of May the rate of inflation remained above the target range and as of 13 May 2013 was estimated at 7.2% over a year ago. Core inflation in April amounted to 5.7%. Observed pace of inflation is mainly explained by the food prices growth and the dynamics of certain regulated prices and tariffs. The inflation rate staying above the target range for a prolonged period of time may affect economic agents' expectations and thus poses inflation risks, in particular taking into account the planned increases in the natural monopolies' tariffs. However, according to the Bank of Russia projections based on the assumptions of maintaining the current monetary policy stance and absence of adverse food prices shocks, the rate of inflation will return to the target range in the second half of 2013."
"The dynamics of the key macroeconomic indicators pointed to a continuing deceleration of economic growth in the first quarter of 2013. The industrial output did not increase as compared to the first quarter of 2012, investment activity stayed weak. Against this background economic confidence indicators are gradually deteriorating. There remain risks of further economic slowdown, stemming among other factors from the sluggish global recovery. At the same time, labour market conditions and credit dynamics still provide support to the domestic demand."
"The Bank of Russia will continue to monitor inflation risks and the risks of the economy slowing down. In making monetary policy decisions the Bank of Russia will be guided by the inflation goals and economic growth prospects."
The next meeting of the Board of Directors of the Bank of Russia on monetary policy issues is planned to be held in the first half of June 2013.
Interest rates for CBR operations in %:
| Purpose | Type of instrument | Instrument | Term | Rate from 11.12.12 | Rate from 03.04.13 | Rate from 16.05.13 |
| Provision of liquidity | Standing facilities (fixed rates) | Overnight loans | 1 day | 8,25 | 8,25 | 8,25 |
| Forex swaps (ruble rate) | 1 day | 6,50 | 6,50 | 6,50 | ||
| Lombard loans, REPO | 1, 7 days* | 6,50 | ,50 | 6,50 | ||
| Lombard loans | 30 day* | 6,50 | 6,50 | 6,50 | ||
| REPO | 12 months* | 8,00 | 7,75 | 7,50 | ||
| Loans secured by gold | Up to 90 days | 7,00 | 6,75 | 6,50 | ||
| Between 91 and 180 days | 7,50 | 7,25 | 7,00 | |||
| Between 181 and 365 days | 8,00 | 7,75 | 7,50 | |||
| Loans secured by non-marketable assets and guarantees | Up to 90 days | 7,25 | 7,00 | 6,75 | ||
| Between 91 and 180 days | 7,75 | 7,50 | 7,25 | |||
| Between 181 and 365 days | 8,25 | 8,00 | 7,75 | |||
| Operations on open market (minimum interest rates) | REPO auctions | 1 day | 5,50 | 5,50 | 5,50 | |
| Lombard loans, REPO auctions | 7 days | 5,50 | 5,50 | 5,50 | ||
| 3 months | 7,00 | 6,75 | 6,50 | |||
| 6 months* | 7,50 | 7,25 | 7,00 | |||
| 12 months | 8,00 | 7,75 | 7,50 | |||
| Liquidity absorption | Operations on open market (maximum interest rates) | Deposit auctions | 7 days | 5,00 | 5,00 | 5,00 |
| 1 month* | 5,75 | 5,75 | 5,75 | |||
| 3 months* | 6,75 | 6,75 | 6,50 | |||
| Standing facilities (fixed rates) | Deposit operations | 1, 7 days *, 1 nth call | 4,50 | 4,50 | 4,50 | |
| Refinancing rate | 8,25 | 8,25 | 8,25 |
* Operations have been suspended.
