The Central Bank of Russia (CBR) announced on Wednesday to further cut down 0.5 percent from its refinancing rate to 12 percent, as effective of Thursday.
Following a continuous slowdown in consumer price growth, the CBR has already cut this key lending rate from 13 percent to 12.5 percent in late April, said the RIA Novosti news agency.
CBR Chairman Sergei Ignatyev said on April 3 that a gradual inflation slowdown will allow the CBR to reduce the refinancing rate. While Russian Prime Minister Vladimir Putin said on April 22 that given the currently slowing inflation, the CBR may anticipate lowering the refinancing rate.
The inflation in Russia totaled 2.4 percent in January, 1.7 percent in February, 1.3 percent in March and could total 1.1 percent to 1.2 percent in April, according to statistics from the Economic Development Ministry.
On the same day, Russian President Dmitry Medvedev urged banks receiving state support to cut interest rate, since "the loans for citizens still remain unaffordable."
"The banks should inject funds into crediting the economy in no less volume than that of state support," the Itar-Tass news agency quoted Medvedev as saying.
"At the same time, the interest rate for such loans will include the refinancing rate plus three percent," he said.
Source: Xinhua
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