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Key Rate of the Bank of Russia Has Hit Maximum Value since 2017

Alexandra V. Bozhechkova – Head of Monetary Policy Department of the Gaidar Institute for Economic Policy; Senior Researcher of the Russian Presidential Academy of National Economy and Public Administration, Candidate of Economic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Pavel V. Trunin – Head of Center for Macroeconomics and Finance of the Gaidar Institute for Economic Policy; Director of Center for Сentral Banks Studies of the Russian Presidential Academy of National Economy and Public Administration, Doctor of Economic Sciences (Moscow, Russia). Е-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

The key rate of the Central Bank of the Russian Federation has been raised by 1 p.p. to 8.5% per annum. It has reached its maximum value since 2017. This is due to the acceleration of inflation on the back of the expansion of demand in the face of continuing problems with goods and services supply. By the end of November 2021, inflation in annual terms came to 8.4% and approached record values over the past 5 years. Given the inertia of inflation, it will remain above the target of 4% for a long time and will return to it no earlier than the end of 2022 – the beginning of 2023.

Key words: inflation, monetary policy, key rate, capital outflow, Bank of Russia.

JEL-codes: E31, E52, F31.