MOSCOW, July 21. /TASS/. The Bank of Russia predicts the key rate at the level of 7.3-8.2% per annum in 2023, by the end of the year the figure is expected in the range of 8.5-9.3% per annum, the regulator said following the meeting of the Board of Directors on Friday.

According to the new forecast of the Bank of Russia, in 2024 the average key rate is expected to be at the level of 8.5-9.5% per annum, in 2025 - 6.5-8.5%. The regulator predicts the key rate in the range of 5.5-6.5% per annum in 2026.

Earlier on Friday, the Bank of Russia has sharply increased its key rate after a long pause by 1 percentage point to 8.5% per annum, noting reinforced inflationary pressure in the economy. "On 21 July 2023, the Bank of Russia Board of Directors decided to increase the key rate by 100 basis points to 8.50% per annum. Current price growth rates, including a variety of underlying indicators, have exceeded 4% in annualized terms and are still on the rise. The increase in the domestic demand surpasses the capacity to expand production, including due to the limited availability of labor resources. This reinforces persistent inflationary pressure in the economy," the regulator said.

The Bank of Russia added that it holds open the prospect of further key rate increase at its next meetings to stabilize inflation close to 4% in 2024 and further on.