1 May 2015
CBR uncomfortable with a strong RUB – BBH
FXStreet (Edinburgh) - Analysts at BBH reviewed the recent decision by the CBR to lower the benchmark rates by 150 bp to 12.50%.
Key Quotes
“The bank said it would continue cutting rates as inflation improves”.
“Officials have made it clear that they were not happy about the fast rebound in the ruble and would prefer the currency weaker, so there was no resistance on that side”.
“Inflation remains high, and the bank noted that the stronger ruble would help lower it”.
“Still, inflation doesn’t seem to be on the top of the central bank’s list of concerns, especially with GDP expected to contract sharply (-3.0%) this year”.
Key Quotes
“The bank said it would continue cutting rates as inflation improves”.
“Officials have made it clear that they were not happy about the fast rebound in the ruble and would prefer the currency weaker, so there was no resistance on that side”.
“Inflation remains high, and the bank noted that the stronger ruble would help lower it”.
“Still, inflation doesn’t seem to be on the top of the central bank’s list of concerns, especially with GDP expected to contract sharply (-3.0%) this year”.