MOSCOW, November 12. /TASS/. The Bank of Russia expects inflation to return to its 4% target next year, with economic growth gradually accelerating and the key interest rate declining cautiously, Central Bank Governor Elvira Nabiullina said at a plenary session of the State Duma.
The current range of fluctuations in the ruble exchange rate is not excessive given sanctions and other circumstances, she noted, adding that low inflation is essential for greater exchange rate stability.
TASS has compiled the key statements made by the central bank governor.
Key interest rate
The period of high interest rates is painful but necessary to improve citizens’ well-being in the future: "The key interest rate has been high for three years and will remain high for some time. Is this justified from the standpoint of the interests of the economy, citizens, and businesses? I am absolutely certain that it is. This is a painful period, but we have no choice. Primarily because our common goal is to improve citizens’ well-being. The government is doing its part to achieve this, and the Central Bank is doing its part. And moderate, predictable price growth is precisely our contribution to citizens’ well-being."
A country where prices are constantly rising will inevitably be vulnerable: "People want moderate mortgage rates to return, and businesses are waiting for affordable loans. A country where prices are constantly rising will inevitably be vulnerable. Only a country with low inflation can count on moderate interest rates, a stable currency, and sufficient investment in its future."
GDP
Russia’s GDP will grow by up to 1% this year despite the loss of production capacity due to drone attacks: "We expect GDP to grow by up to 1% this year, despite the loss of production capacity in certain sectors as a result of attacks. Without this factor, economic growth this year would, of course, have been higher."
"The latest data indicate that economic growth rates will gradually increase going forward. Of course, much depends on how quickly production facilities damaged by attacks can be restored. The government and businesses are doing everything possible to restore and protect these facilities as quickly as possible."
Ruble exchange rate
The ruble exchange rate should be determined not by the needs of individual industries but by its attractiveness as a means of saving: "Our position is that the ruble exchange rate should be determined not by the needs of selected industries, because all industries are important to the economy, but by export and import flows and the attractiveness of the ruble as a means of saving. Only in this case does the exchange rate channel work as a mechanism that strengthens the economy."
The current range of fluctuations in the ruble exchange rate is not excessive given sanctions and other circumstances: "Considering all our circumstances, all the sanctions, our current range of fluctuations does not seem excessive. But how can we make the exchange rate more stable? There is a general rule: the lower inflation is, the more stable the exchange rate is, all else being equal. This is an indisputable fact confirmed by the history of many countries over many decades."
Restoring infrastructure after attacks
The Central Bank has selectively eased regulations to encourage lending for protecting production facilities against drone attacks: "We have selectively eased banking regulations so that banks have an incentive to issue loans to protect production facilities and infrastructure against attacks."
Investment
The Bank of Russia has recorded an increase in investment activity over the past two quarters of 2026 and expects investment to grow in 2027, including in physical terms: "Investment activity has been growing over the past two quarters after hitting a low point in the first quarter."
The Central Bank expects that next year "investment will increase not only in trillions, but also in physical terms."
Labor productivity
The real sector of the Russian economy has sufficient financial resources but inadequate labor productivity: "Overall, the real sector has resources, financial resources: profits of 25 trillion [rubles], and lending is growing by more than a trillion a month. But most importantly, investment is almost a quarter higher than five years ago. So why has labor productivity in our economy increased by a much smaller amount over these five years, by just 5%? And this discrepancy is striking. Apparently, the issue is not only, or even primarily, the availability of financing and the volume of investment, but rather how these resources are allocated."
Inflation
Russia needs to complete the "import substitution of global inflation" so that its economy can "stand firmly on its own feet": "We need, if you will, to complete the import substitution of low global inflation and moderate global interest rates with similar conditions in our own economy. This is absolutely essential for our economy to stand firmly on its own feet."
The Bank of Russia plans to return inflation to its 4% target next year: "We expect to reach our 4% inflation target next year. This is our baseline forecast. It also envisages a gradual acceleration in the economy and economic growth, along with a steady, albeit cautious, reduction in the key interest rate."