Russia: CBR to keep its Key Rate on hold - TDS

Analysts at TDS expect the CBR to keep its Key Rate on hold at 7.25% at today’s Board meeting, in line with the consensus with only 3/36 respondents to the Bloomberg survey expecting a cut.

Key Quotes

“Since the last Board meeting, on 23 March, the ruble has weakened by more than 8.0% against the US dollar with the sell-off triggered by the US increasing its sanctions on Russia. The CBR will be concerned that ruble weakness, if maintained, or indeed extended, could lead to inflation overshooting the 4% target later this year. This argues for the CBR returning to its more cautious stance, and waiting to see what happens to the currency.”