Russian central bank surprises markets by holding key rate at 21%

Russia’s central bank kept its key interest rates unchanged at 21% on Friday, citing improved monetary tightness that could help curb high inflation. The bank noted that the tightening of monetary conditions had exceeded expectations, leading to a decrease in credit activity and creating conditions for disinflation. Despite current high inflation levels, the bank plans to assess the need for a rate increase in February, with a forecast of annual inflation declining to 4% in 2026.

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