Economist Grigoryev named the pros and cons of lowering the key interest rate.

      24 October 2025 17:25 Economy

      After the meeting of the Central Bank’s board of directors on October 24 the key rate was cut to 16.5%. This decision may have a significant impact on various aspects of the economy, including mortgage lending, consumer loans and the exchange rate of the national currency.

      According to Candidate of Economic Sciences and expert in finance and banking Vladimir Grigoryev, the high cost of money had fueled expectations of a more substantial rate cut.

      Grigoryev told 360.ru that the previous rate cut was less significant than expected.

      The reduction of the key rate should lead to lower borrowing costs. However, in Grigoryev’s view, this change is unlikely to be sufficient to meet all borrowers’ expectations.

      The Central Bank is pursuing a cautious policy, given that lowering the key rate may affect inflation and the ruble’s exchange-rate stability. Although a high key rate makes financial instruments, deposits and bonds more attractive, additional sanctions by the US and the European Union are putting extra pressure on the ruble.

      The cut in the key rate is expected to lead to a slight drop in loan and mortgage rates. Grigoryev noted that the Central Bank has repeatedly emphasized its readiness to return to tighter monetary policy if target parameters are breached.

      The trend in recent months points to a possible further decline in the key rate. However, as Grigoryev noted, if the situation begins to deteriorate in terms of inflation and ruble weakening, the Central Bank may pause further cuts.

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