Russia's ex-finance minister approves central bank's move to hike interest ratesARCHIVE
Russia's former deputy prime minister and finance minister Alexey Kudrin said the central bank made the right move hiking the interest rate from 10.5% to 17%.
“The Central Bank’s decision to raise the rate to 17% is a forced one but correct decision in the current conditions,” Kudrin wrote in his Twitter account.
Russia’s Central Bank took a decision early on Tuesday to hike the key rate determining the borrowing cost for commercial banks to 17% from 10.5%
Simultaneously, the regulator increased the limits of foreign currency repo auctions for a term of 28 days to $5 billion from $1.5 billion. The regulator will also hold similar auctions for a term of 12 months every week. The Central Bank will provide loans against non-market assets for a term of 2 to 549 days at a floating rate comprising the key rate plus 1.75%
The regulator said in a statement its decision to increase borrowing costs for commercial banks was prompted by the need to restrain devaluation and inflationary risks that had sharply increased lately.