18 Aug 2023 09:56

Central Bank of Russia sees current monetary policy setting stage for balanced lending growth without price stability risks

MOSCOW. Aug 18 (Interfax) - Current monetary policy creates the conditions for balanced growth of lending that does not present a risk to price stability, the Central Bank of Russia (CBR) said.

"The monetary policy pursued by the Bank of Russia, including the latest decision to raise the key rate to 12% per annum, provides conditions for balanced growth of lending activity that does not hinder the achievement of price stability," the CBR's press service told Interfax when asked if the CBR plans to take additional steps to cool lending.

Some segments of the credit market are less sensitive to changes in the key interest rate, such as mortgage lending, and the CBR factors this in when making monetary policy decisions. "The reaction of the market segment of the credit market should be such as to also compensate for the insensitivity of the mortgage segment," the CBR said.

Macroprudential measures make it possible to restrain the riskiest segments of retail lending, the CBR said.

Furthermore, the key rate hike will also affect deposit rates, increasing the appeal of bank deposits for individuals. "This will also ensure a more balanced dynamic of demand that is in line with the possibilities for expanding supply, and the achievement of the target for inflation," the CBR said.