MOSCOW, July 24. /TASS/. The Bank of Russia has decided to cut its key rate by 25 basis points to 14% per annum, according to the regulator’s press release following its board meeting.

TASS has collected the main facts about the decision.

Regulator’s decision

The Central Bank reduced the key rate by 25 basis points to 14% per annum.

The regulator noted though that a smoother key rate decrease is required given the direct and second-round effects of the temporary decline in production capacities in certain sectors and more expansionary fiscal policy over a three-year horizon than projected in April.

Considerable price growth and higher inflation expectations in the summer months were mainly associated with one-off factors, according to the press release.

Measures of underlying inflation remained within the range of 4-5% in annualized terms, the regulator said.

Central Bank’s forecasts

Annual inflation in Russia will reach 6-7% in 2026 due to the significant rise in fuel prices, and return to the target level in 2027, according to the press release.

Measures of underlying inflation remained within the range of 4-5% in annualized terms. As of 20 July, annual inflation stood at 5.9%, the regulator said.

The Bank of Russia upgraded its forecast for the average key rate through the end of 2026 from 14-14.5% to 14.5-14.6%.

The forecast for the average key rate for 2027 was revised upward from 8-10% to 10.5-12.5%.

The forecast for 2028 was also upgraded to 8-9% from 7.5-8.5%.

The forecast for 2029 stands at 7.5-8.5%.

The regulator’s GDP growth forecast for 2026 was revised downward from 0.5-1.5% to 0-1%.

The 2027-2028 forecast was not changed.

The regulator projects GDP growth of 1.5-2.5% in 2027 and 1.5-2.5% in 2028.

The Central Bank also expects the country’s GDP growth to be in the range of 1.5-2.5% in 2029.

The regulator downgraded its forecast for the oil price used for taxation purposes in 2026 from $65 to $60 per barrel.

The forecast for the oil price used for taxation purposes for 2027 and 2028 was downgraded to $50 from $55.

The forecast for the oil price used for taxation purposes for 2029 equaled $50.

The Central Bank downgraded its forecast for household lending growth in 2027 to 5-10% from the previous range of 8-13%.

This year's outlook for household lending growth remained unchanged at 5-9%.

The Bank of Russia maintained its forecast for mortgage lending growth in Russia in 2026 at 6-10%.

The regulator upgraded its mortgage market growth forecast for 2027 to 7-12%.

For 2028 and 2029, the Central Bank expects annual growth of 10-15%.

The forecast for growth of bank lending to companies in 2027 was downgraded to a range of 7-12% from the previous 8-13%.

The forecast for corporate lending growth remained unchanged at 7-11% for 2026, and at 8-13% for 2028 and 2029.

Russian economy

The Russian economy grew moderately in Q2 2026, mainly driven by consumer demand, the press release said.

Lending activity slowed in June mainly due to corporate lending dynamics. Contrastingly, the growth of the corporate loan portfolio sped up, the regulator said.

Proinflationary risks still prevail over disinflationary ones on the medium-term horizon, according to the Central Bank.

The labor market tightness has been gradually easing, the Bank of Russia said, adding that wage increases slowed but continue to outpace labor productivity growth.

Unemployment stays at its record lows, the regulator noted.