MOSCOW, October 28. /TASS/. The Russian economy is currently moving along a scenario of a managed recovery from overheating, Central Bank Governor Elvira Nabiullina announced in the State Duma, the lower house of parliament.
She noted that the key rate reduction cycle will span the entire 2026.
TASS has collected key statements of the Governor of the Bank of Russia.
About national economy
The Russian economy is currently moving along a "managed recovery from demand overheating scenario"
"Demand growth has slowed, while production potential, on the contrary, is expanding and gradually catching up with demand," Nabiullina said.
Overall, resource availability remains the main constraint on economic growth.
On the key rate
The key rate reduction cycle will span the entire year of 2026.
"Since June, we entered a key rate reduction cycle, lowering it by 4.5 percentage points in four months. According to our forecast, the key rate reduction cycle will span the entire next year," Nabiullina said.
All decisions on the key rate are based on the need to end the period of high price growth as quickly as possible while preventing the economy from overcooling.
A hasty reduction in the key rate would undo all the progress achieved.
"We would have to start all over again," Nabiullina said.
On inflation
Inflation in Russia will fall to the target level of 4% in the second half of 2026.
"Next year, we expect inflation to be at 4-5%, that is, slightly above target, due to the significant contribution of one-off factors at the very beginning of the year. Our forecast assumes that in the second half of 2026, the current rate of price growth will finally fall to the target level," the Bank of Russia Governor said.
Inflation expectations may remain high in the coming months due to one-off factors.
"We understand that inflation expectations in the coming months, unfortunately, may remain high due to the increase in VAT, the recycling fee, and rising gasoline prices. These goods, markers, and these factors, they overlap and, of course, increase citizens' expectations," Nabiullina explained.