UPDATE 1-Russia cenbank plans to keep key rate above 6% until mid-2023

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MOSCOW, Nov 15 (Businesshala) – Russians are scared off by rising prices and the central bank plans to keep its key interest rate above 6% until at least the middle of 2023 to bring inflation back, the central bank’s governor said. Elvira Nabiullina said on Monday.

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The central bank has raised its key rate six times so far this year, struggling to contain consumer inflation, which rose to an all-time high of 8.14% in early November, up from the 4% target since 2016. is above. The next rating meeting is on December 17.

“Inflation is a real disaster that makes people poor. The rise in inflation expectations, which really worries us, and the way it has affected financial behavior, shows how people fear inflation, Nabiullina said.

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“We need to bring inflation back to the 4% target at any cost.”

Presenting the bank’s monetary policy outlook for 2022-2024 in the lower house of parliament, Nabiullina reaffirmed her desire to raise the key rate again at a December board meeting.

A Businesshala poll late last month showed the market had on average expected the Bank of Russia to raise the key rate to 8% by the end of the year.

Nabiullina said inflation, the bank’s main area of ​​responsibility, will slow from 7.4-7.9% at the end of 2021 toward the next year’s target. But he pointed to potential upside risks, saying that the nature of inflation may not be as temporary as it used to be. Thinking.

Nabiullina also said that Russia’s economy has returned to its pre-pandemic growth trend and jobless numbers are near record lows.

President Vladimir Putin said last week that the Russian economy was on track to register its strongest growth in 13 years and expand to 4.7% in 2021. (Additional reporting by Katya Golubkova and Elena Fabricnaya)

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