MOSCOW (Reuters) -Russian Central Bank Governor Elvira Nabiullina and her deputy Alexei Zabotkin addressed a news conference on Friday after the central bank cut its key rate to 17% from 18%.
They spoke in Russian and the quotes below were translated into English by Reuters.
NABIULLINA ON OPTIONS FOR KEY RATE DECISION
"Two options were considered at the meeting: lowering the rate by 1% and keeping the rate unchanged. The arguments in favour of keeping the rate unchanged were that monetary conditions
had eased significantly and that we needed to assess the consequences of the decisions already taken. And, of course, we will need to obtain more information about what the budget policy will ultimately be."
NABIULLINA ON THE BUDGET FACTOR
"Our decision today reflects our understanding, based on the information currently available, of how the budget will shape up at the end of 2025 and its parameters for 2026, 2027 and 2028. We assume that the budget will be disinflationary for the year, but the extent of this will be clarified when amendments to this year's budget are made. We expect the government to present specific quantitative characteristics by the end of September, and we will include them in our forecast update at the October meeting.
And, of course, the budget factor is always important, as is the predictability of budget policy in general."
NABIULLINA ON THE EXCHANGE RATE
"We always take into account exchange rate dynamics. This is an important indicator of the degree of monetary policy tightness and the main indicator through which changes in external conditions affect inflation. With a monetary policy aimed at low inflation, a stable, self-sustaining weakening of the exchange rate is impossible.
But fluctuations do occur. They are inevitable when economic conditions change. And, of course, we analyse all these factors when making decisions."
(Editing by Mark Trevelyan)
