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Russia slashes key interest rate by 150 basis points in shock move

The headquarters of Russia’s central bank in Moscow, Russia, on Monday, Feb. 28, 2022.
Bloomberg | Bloomberg | Getty Images

Russia’s central bank on Friday cut its key interest rate by a bigger-than-expected 150 basis points, as the country deals with a strong currency, cooling inflation and a possible recession.

The cut takes the key rate to 8% from 9.5%; analysts had expected a rate cut of 50 basis points, according to a Reuters poll.

“The external environment for the Russian economy remains challenging and continues to significantly constrain economic activity,” the bank said in a statement.

It is the fifth rate cut by the Central Bank of Russia so far this year after an emergency hike from 9.5% to 20% in late February, following Moscow’s invasion of Ukraine.

In June, its reduced the rate by 150 basis points to 9.5% — the level it was at when Russia’s invasion of Ukraine began.

This is a developing story and will be updated shortly.

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