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Russian Rate Cut Tops Forecasts, Sends Ruble Rally Into Reverse

  • Third straight reduction takes aim at ruble’s rebound
  • Currency’s gains concern the Kremlin, imperil budget revenue
The Central Bank of Russia in Moscow.

The Central Bank of Russia in Moscow.

Source: Bloomberg

Updated on

Russia’s central bank delivered its third interest-rate reduction in just over a month and said borrowing costs can fall further still, halting a rally in the ruble as it unwinds the financial defenses in place since the invasion of Ukraine.

The Bank of Russia lowered its benchmark to 11% from 14% on Thursday at an extraordinary meeting it announced only a day earlier. All 23 economists surveyed by Bloomberg predicted a reduction, with most forecasting a cut of two percentage points.