Central Bank of Russia Lowers Policy Rate by 50 Basis Points to 15.50%

The Central Bank of Russia announced on Friday that it has lowered its key policy rate by 50 basis points to 15.50%. The reduction took many market participants by surprise, since most analysts polled had forecast that the bank would pause its rate-cutting campaign.

Since initiating an easing cycle in June of last year, the central bank has trimmed its policy rate by a total of 550 basis points. The latest action is a further step in that ongoing shift in monetary stance.

Market expectations ahead of the decision were captured in a poll conducted by LSEG. According to that survey, only eight out of 24 analysts anticipated a half-point reduction. The majority of respondents - 16 analysts - had expected the central bank to keep the rate unchanged.

Officials framed the decision as a continuation of the easing process that began in mid-last year, with the bank adjusting its overall posture toward the Russian economy. Beyond the numerical changes in the rate and the aggregated extent of easing since June, the announcement did not include additional details about future steps or accompanying guidance.

Key points

• The Central Bank of Russia lowered its key interest rate by 50 basis points to 15.50% on Friday.
• The bank has cut its policy rate by 550 basis points in total since the easing cycle began in June last year.
• An LSEG poll showed that 8 of 24 analysts predicted the 50 basis point cut, while 16 expected the bank to hold rates steady. The article does not specify particular economic sectors affected by the decision.

Risks and uncertainties

• The decision was unexpected to most market watchers, indicating uncertainty about near-term policy direction.
• Survey results show a divide in analyst expectations ahead of the announcement, reflecting uncertainty in forecasting the bank's next moves.
• The article does not provide details on future guidance from the central bank, leaving the longer-term path of policy unspecified.

This report focuses on the factual details of the rate change, the cumulative amount of easing since the cycle began, and the distribution of analyst expectations as measured by the cited LSEG poll. No additional claims or interpretations beyond the information provided are offered here.