The Bank of Russia announced on Friday that it will keep its benchmark interest rate unchanged at 14%, marking the second consecutive policy meeting without a move. This decision aligns with the expectations of 11 economists surveyed by Bloomberg, with only one economist having predicted a 25 basis point cut.
In its statement, the Bank of Russia said: "Current price pressures remain elevated." Over the medium term, risks tilting inflation upward are dominant; the monetary policy decision will be made "based on changes in price growth, inflation expectations, and assessments of internal and external environment risks."
Ukrainian strikes targeting oil refining facilities have driven crude processing rates to multi-year lows and triggered fuel shortages, further intensifying inflationary pressure. Inflation has already exceeded the central bank's latest year-end forecast.
The Bank of Russia had originally expected refineries to gradually resume production in the second half of the year, but sustained attacks have caused new damage, with some facilities that had just restarted operations also affected.
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