Russia again cuts key rate

MOSCOW: Russia’s central bank on Friday cut its key rate for the second time in just over a month, trying to breathe more life into the country’s economic recovery on the back of lower inflation.

“The Bank of Russia (BoR) board of directors decided to reduce the key rate to 9.25 percent per annum,” the bank said in a statement.

“The board notes that inflation is moving toward the target, inflation expectations are still declining and economic activity is recovering,” it said.

Friday’s cut is the second time the central bank has dropped its key rate in five weeks as recovering oil prices and a stronger ruble have helped inflation move closer to a four-percent target, which authorities hope to hit by the end of the year.

Inflation stood at 4.3 percent in March. Russia’s economy has appeared to stabilize over the last few months after a crippling recession brought on by low energy prices and Western sanctions over Ukraine.

Officials are still trying to roll back the key rate in a bid to boost the recovery after they were forced to hike it dramatically in late 2014 in the face of a severe ruble slump.

The central bank noted that there are “signs of nascent recovery in consumer activity” after the economic crisis shrank purchasing power and pushed large segments of the population into poverty.

The country’s economy expanded for the first time in two years in the fourth quarter of 2016, data from the state statistics service showed in March.