Template-Type: ReDIF-Paper 1.0
Author-Name:Bozhechkova Alexandra
Author-Name-First: Alexandra 
Author-Name-Last:Bozhechkova 
Author-Workplace-Name: Gaidar Institute for Economic Policy 
Author-Name:Trunin Pavel
Author-Name-First: Pavel 
Author-Name-Last:Trunin 
Author-Workplace-Name: Gaidar Institute for Economic Policy 
Author-Name:Knobel Alexander
Author-Name-First: Alexander 
Author-Name-Last:Knobel 
Author-Workplace-Name: Gaidar Institute for Economic Policy 
Author-Name:Kiyutsevskaya Anna
Author-Name-First: Anna 
Author-Name-Last:Kiyutsevskaya 
Author-Workplace-Name: Gaidar Institute for Economic Policy 
Title: Russia’s Monetary Policy in 2016
Abstract: In 2016, the Bank of Russia implemented a conservative monetary policy aimed at mitigating inflation. Commercial banks decreased their demand for central bank refinancing as the Reserve Fund was spent, in which case the central bank had to employ a set of instruments to prevent an increase in the money supply. It happened twice over the course of the year – on June 14 and September 19 – that Russia’s central bank cut 0.5 percentage points off the key rate, to 10% p.a. With a declining inflation rate and inflation expectations available during the year, a rather moderate decline in the key rate suggested growth of the real interest rate in the money market. Maintaining a positive real rate in the money market helps prevent prices from hiking upwards as the savings appeal strengthened, although there is risk of economic slowdown.
Classification-JEL: E31, E43, E44, E51, E52, E58
Keywords:  Russian economy, monetary policy, money market, exchange rate, inflation, balance of payments
Creation-Date: 2017
Revision-Date:2017
Length: 19 pages
File-URL: https://www.iep.ru/files/RePEc/gai/ppaper/ppaper-2017-269.pdf
File-Format: application/pdf
File-Function: Revised version, 2017
Handle: RePEc:gai:ppaper:ppaper-2017-269