Russian Central Bank raises key rate for first time since 2014
The Russian Central Bank raised its key lending rate unchanged in six months by 0.25 percentage points to 7.5 percent on higher inflation expectations.
It was the first rate hike since 2014 when a currency crisis broke out following Western sanctions, Xinhua reported.
“Changes in external conditions observed since the previous meeting of the Board of Directors have significantly increased pro-inflationary risks,” it said in a statement.
The bank now forecasts Russia’s annual inflation to be 3.8-4.2 percent this year, compared to its previous forecast of 3.5-4.0 percent.
Annual inflation will peak in the first six months of 2019, reaching 5.0-5.5 percent by the end of 2019, it said.
In July, it said that the inflation could temporarily exceed the previously targeted four percent next year due to the increase in the value-added tax (VAT) to 20 percent from 18 percent in 2019.
However, the bank expects that the quarterly consumer price growth rate will draw close to four percent in the second half of 2019 and annual inflation will slow down to four percent in the first half of 2020 when the effects of the ruble’s weakening and the VAT rise peter out, it said in the Friday’s statement. British Steel has announced it is to cut 400 jobs from its worldwide operations.
The company, which employs 5,000 people, said the job losses were part of a ‘streamlining’ process, BBC wrote.
Most of the redundancies will be in managerial, professional and administrative roles across its businesses in the UK, Ireland, France and the Netherlands.
The Community trade union described the news as “a body-blow to the workforce”.
Roland Junck, British Steel’s executive chairman, said he was ‘sad’ to be making the announcement.
“However, it’s vital our transformation continues so we can build a sustainable future for the whole business, nearly 5,000 employees and many more people in the supply chain,” he said.