Russia Rate Wording Pits Morgan Stanley Against Easing Calls

Russia’s central bank removed a reference to interest rates being adequate, pitting banks including Morgan Stanley against market consensus in predicting an increase in borrowing costs.

Policy makers dropped a phrase that money-market rates are acceptable for the “nearest future” in a statement on yesterday’s decision to leave the refinancing rate at 8.25 percent for a fourth month. While a Bloomberg survey and contracts used to speculate on three-month borrowing costs point to lower rates later this year, the last time this language disappeared, interest rates were raised the next month.