Nabiullina repeats one or more rate hikes possible, links future easing to deposit conditions

SOCHI. Sept 17 (Interfax) - The Central Bank of Russia's (CBR) decision to raise its key interest rate by 1 percentage point in July has not completely played itself out and one or more additional rate hikes might be needed at upcoming CBR board meetings, Central Bank chief Elvira Nabiullina said at the International Banking Forum in Sochi, organized by the Association of Banks of Russia.

"Of course, we will look at how the situation changes. The more so since it's clear that our July decision, when we raised the rate by 1 percentage point at once, has not yet completely played itself out, as they say. Therefore, an additional increase or several upward steps might be needed at upcoming meetings of the board of directors," Nabiullina said.

"Of course, at some point the rate will return to a neutral level, but this will not happen before we're confident in the steady slowdown of inflation," she said.

In order for the CBR to start lowering the key rate, inflation expectations need to decrease, and household savings need to increase, she said. "This is unlikely to happen before people are happy with deposit rates," Nabiullina said.