20.03.202610:51:42UTC+00Russia Cuts Rate by 50bps as Expected

The Central Bank of Russia cut its key policy rate by 50 bps to 15% at its March 2026 meeting, in line with market median expectations and marking a seventh consecutive reduction from the record high of 21% reached last year. The Board of Directors noted that core inflation indicators declined more than anticipated at the start of the year, justifying a continued easing of monetary policy. The decision was also supported by leading indicators pointing to slower economic growth, while the government’s new VAT regime is expected to weigh on consumer spending. At the same time, the central bank cautioned that it may not prolong the easing cycle, citing upside risks to inflation from higher energy prices following the outbreak of war in the Middle East. Thus far, the conflict has not tightened domestic financial conditions via higher benchmark bond yields, as the surge in oil and gas prices has boosted government revenues and reduced the need for additional bond issuance.