Bank of Russia cuts key rate by 100 bp to 17.00% p.a.
Central bank: cbr | Type: statement | Date: 2025-09-12

On 12 September 2025, the Bank of Russia Board of Directors decided to cut the
by 100 basis points to 17.00% per annum. Underlying measures of current price growth have not changed significantly and generally remain above 4% in annualised terms. The economy continues to return to a balanced growth path. Lending growth has accelerated in recent months. Inflation expectations remain high.
The Bank of Russia will maintain monetary conditions as tight as necessary to return inflation to the target in 2026. Further decisions on the key rate will be made depending on the sustainability of the inflation slowdown and the dynamics of inflation expectations. According to the Bank of Russia’s forecast, given the monetary policy stance, annual inflation will decline to
in 2025, return to 4.0% in 2026 and stay at the target further on.
In July—August, the current seasonally adjusted
price growth
averaged 6.3% in annualised terms after 4.4% in 2025 Q2. The similar indicator of core inflation went down to 4.1% from the average of 4.4% in the previous quarter. Most indicators of underlying inflation are in the range of
in annualised terms. As of 8 September 2025, annual inflation stood at 8.2%.
Tight monetary conditions continue to contribute to disinflation. The current price growth rate in July—August was substantially affected by one-off factors. On the one hand, utility rates were significantly adjusted upwards, motor fuel prices were also up. On the other hand, fruit and vegetables cheapened more than usual in the summer months. Price dynamics remain uneven across consumer basket components.
Inflation expectations have not changed considerably in recent months. In general, they remain elevated. This may impede a sustainable slowdown in inflation.
The upward deviation of the
Russian economy
from a balanced growth path is narrowing. High-frequency data and survey indicators show a slowdown in overall economic activity growth in 2025 Q3, while the growth rate is still positive. The dynamics of business activity is uneven across industries. A significant cooldown is recorded in export-oriented industries. Domestic demand is backed up by rising household incomes and budget expenditures. Consumer activity growth has even slightly sped up.
Monetary conditions
have eased but remain tight. Interest rates have declined in most financial market segments. This shows both the effects of previous key rate cuts and the revision of market participants’ expectations for its further path.
While deposit rates are decreasing, households continue to demonstrate high propensity to save. Nevertheless, lending activity has increased in recent months. The corporate loan portfolio growth has sped up significantly. Retail lending demonstrates some recovery. According to the Bank of Russia, in 2025, the overall growth rate of claims on the economy will probably be closer to the upper bound of the July forecast range of
7.0–10.0%.
Proinflationary
risks still
prevail over disinflationary ones in the
horizon. The key proinflationary risks are associated with a longer upward deviation of the Russian economy from a balanced growth path and high inflation expectations, as well as with the deterioration in the terms of external trade. A further decrease in the growth rate of the global economy and oil prices in case of escalating trade disputes may have proinflationary effects through the ruble exchange rate dynamics. Geopolitical tensions remain a significant uncertainty factor. Disinflationary risks involve a more significant slowdown in domestic demand.
The Bank of Russia takes into account the announced parameters of fiscal policy. Its normalisation in 2025 should have a disinflationary effect. However, it has not yet materialised taking into consideration the budget deficit accumulated since the beginning of this year. The Bank of Russia will update its assessments of the fiscal policy effects on inflation after the Government submits the 2025 budget amendments and new budget projections for the medium-term horizon to the State Duma. Changes in the fiscal policy parameters may require an adjustment in the monetary policy pursued.
On 24 September 2025
, the Bank of Russia releases the Summary of the Key Rate Discussion.
The Bank of Russia Board of Directors will hold its next key rate meeting on
24 October 2025
. The press release on the Bank of Russia Board decision and the medium-term forecast are to be published at 13.30 Moscow time.
Statement by Bank of Russia Governor Elvira Nabiullina in follow-up to Board of Directors meeting on 12 September 2025
12.09.2025 13.30.00