CBR's Nabiullina sets to reduce rate by 100bps to 4.50 per cent amid late-epidemic

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CBR's Nabiullina sets to reduce rate by 100bps to 4.50 per cent amid late-epidemic

On Friday, the 8th of May 2020, the Central Bank of Russia (CBR) Chief, Elvira Nabiullina, said that the CBR had been brewing off an option to slash the nation’s benchmark interest rate for the third time this year by 100bps as early as by June during a meeting of policymakers, citing a growing risk of pessimistic business outlook amid a late-epidemic in Russia while a majority of European economies have been set to ease lockdowns further.

In point of fact, latest remarks from the CBR head Elvira Nabiullina came forth shortly after the WHO (World Health Organization) was quoted saying in a report that the transcontinental nation had been facing off a late-epidemic with the country capital Moscow bearing the heaviest brunt.

In point of fact, over the first four months of this year, CBR (Central Bank of Russia) had slashed interest rate twice, while it had slashed the key borrowing rate by 25bps in February and by 50 bps last month to 5.50 per cent.

Meanwhile, adding that the CBR might stall another rate-cut by 100bps to 4.50 per cent by June this year considering the dynamics of Russ economy amid a pandemic-driven downturn which could ease by end-May or early-June, CBR head Elvira Nabiullina said on Friday (May 8th), “At the last meeting of the board of directors (April 24), we considered the possibility of reducing the rate by 100 basis points.

I admit that if the situation develops as it is now, the option of reducing by 100 basis points will also be considered, of course, among other alternatives (in June),” citing a record decline in composite PMI last month alongside a forecast of 8 per cent plunge in economic growth in the second quarter on a year-on-year basis.