MOSCOW: Russia’s central bank reduced on Friday its key interest rate to 7.75 per cent, the sixth reduction this year as inflation hits a record low.

The bank said in a statement it had trimmed its main interest rate by 0.50 percentage points, a quarter of a percentage point more than most analysts had predicted. “Inflation holds at 2.5 percent and will gradually draw near 4 percent by late 2018. The extension of the agreement to reduce oil production brings pro-inflationary risks down over a one-year horizon,” the bank said as it announced the rate cut.

The bank also said it would continue its “gradual” monetary policy as medium-term inflation risks persist.

Russia’s central bank is still struggling to boost the economy as it slowly emerges from the longest recession of President Vladimir Putin’s rule triggered by low oil prices and Western sanctions over Ukraine.

Published in Dawn, December 16th, 2017