Key rate stays at 14.00 percent as price pressures persist
The Bank of Russia held its key rate at 14.00 percent on October 23, 2026, citing elevated price pressures and inflation expectations. Its baseline projects an average rate of 12.5–13.5 percent in 2027.
Inflation accelerates before projected decline
Annualized, seasonally adjusted price growth rose to 8.0 percent in Q3 2026 from 4.8 percent in Q2; core inflation rose to 6.2 percent from 4.5 percent.
Volatile components, chiefly motor fuel, affected prices.
Underlying price growth remained at 5–6 percent, reflecting temporary production-capacity reductions in certain sectors.
Annual inflation stood at 6.8 percent on October 19. The bank forecasts 7.1–7.6 percent at end-2026 and a return to its 4.0 percent target in 2027.
Household and business expectations eased slightly in October but remained near two-year highs; market participants' and analysts' expectations increased.
Further rate decisions depend on inflation, expectations and domestic and external risks.
Moderate growth meets tight financing
The economy grew moderately in H2 2026.
Consumer demand slowed but remained elevated; investment recovered.
Labor shortages eased and wage growth slowed, but still outpaced productivity.
Firms plan smaller wage increases in 2027 than in 2026.
Monetary conditions remained moderately tight; corporate lending drove elevated Q3 credit growth.
Fiscal policy supports medium-term disinflation, but changes may require a policy adjustment.
The next rate meeting is December 18, 2026, with the decision due at 13:30 Moscow time.
Upside inflation risks dominate
The bank sees inflation risks tilted upward because demand exceeds constrained supply.
Elevated expectations, wages outpacing productivity and geopolitical pressures add to those risks.
A sharper demand slowdown is the downside risk; moderate demand growth is needed for underlying inflation to decline.