On July 24, the Board of Directors of the Bank of Russia lowered the key rate by 25 bp, to 14.0% per annum. The regulator notes that in the second quarter of 2026, the economy grew moderately, and the acceleration of inflation in the summer was largely due to one-time factors. At the same time, the estimate of sustainable inflation remains at the level of 4–5% in annual terms.
According to the Central Bank, lending growth slowed slightly in June, and enterprises lowered their expectations for future demand and output. However, due to a temporary reduction in production capacity in certain industries and a more stimulating fiscal policy, the reduction in the key rate should be gradual.
The Bank of Russia reported that further decisions will depend on inflation dynamics, inflation expectations and assessment of internal and external risks. The baseline forecast calls for an average key rate of 14.5–14.6% in 2026 and 10.5–12.5% in 2027. Inflation in 2026 is expected to be 6.0–7.0%, and should return to the target level in 2027.
In the second quarter, seasonally adjusted price growth averaged 5.0% in annual terms after 8.7% in the first quarter, and core inflation slowed to 4.2% from 6.2%. In June–July, price growth accelerated again, mainly due to higher prices for motor fuel and fruits and vegetables. As of July 20, annual inflation was 5.9%.
Inflation expectations of the population, business and financial markets have increased. Economic growth in the second quarter was driven mainly by consumer demand, while investment activity remained subdued. The GDP growth forecast for 2026 has been reduced to 0.0–1.0%, while the forecast for 2027–2028 has been maintained.
The Central Bank also noted a gradual decrease in tensions in the labor market, a slowdown in wage growth while unemployment remained at historical lows. Lending activity weakened in June due to the corporate segment, while retail lending accelerated.
The regulator believes that pro-inflationary risks still exceed disinflationary ones. The next meeting on the key rate will take place on September 11, 2026, and materials with details of the discussion and an updated forecast will be published on August 5.
Source: https://www.zerno.ru/node/33826