The Central Bank of the Russian Federation responded to a request from State Duma deputy Denis Parfenov to reduce the key rate.
The regulator believes that in the current economic situation, lowering the key rate in the Russian Federation is dangerous.
The Central Bank explained that the labor shortage and rising costs will lead to an additional acceleration of inflation, as emphasized in the RIA Novosti article.
Reducing the key rate in conditions where demand already exceeds supply could worsen the economic situation.
The Bank of Russia indicated that cheap loans are not capable of providing producers with additional resources.
Cheap money at low rates in conditions of labor and capacity shortages will not help enterprises obtain more resources.
The regulator points out that, as a result, costs will increase and, as a consequence, prices for final products.
A high key rate will not reduce production capacity, but will help slow down excess demand.
The Bank of Russia also expects that GDP growth rates in 2025 will temporarily slow down due to subdued consumer demand.
