Russia’s central bank says it needs months to ensure CPI falls before cutting rates -RBC According to Reuters

© Reuters. Russian Central Bank Governor Elvira Nabiullina attends a press conference in Moscow, Russia June 14, 2019. REUTERS/Shamil Zhumatov/File Photo

MOSCOW (Reuters) – Russia’s central bank will need two to three months to make sure inflation is steadily falling before taking any decision to cut interest rates, the bank’s governor Elvira Nabiullina told RBC media on Sunday.

The central bank raised its key interest rate by 100 basis points to 16% earlier in December, setting off for a fifth consecutive meeting in response to stubborn inflation and signaling that the tightening cycle is almost over.

Nabiullina said it is not yet clear when exactly the regulator will start reducing rates.

“We really need to make sure that inflation is steadily coming down, that these are not one-off factors that can affect the rate of price growth in a particular month,” she said.

Nabiullina said that the bank takes into account a wide range of indicators, but especially those that “characterize the stability of inflation.”

“This will take two or three months or longer – depending on how much the broad range of indicators that characterize sustainable inflation declines,” she said.

The bank will meet next year to set its benchmark rate on February 16.

The governor also said the bank should have started tightening monetary policy earlier than in July, when it began its rate hike cycle.