MOSCOW (AP) ― In a surprise decision, Russia’s central bank on Friday
cut its key interest rate, which it had raised sharply last month to
support the collapsing ruble, in order to help the fading economy.
The move triggered a drop in the ruble, which was down more than 3 percent at 71 rubles against the dollar in early afternoon trading in Moscow.
The central bank explained its decision to cut the rate from 17 percent to 15 percent by saying that the risks of an economic slowdown are now higher than the risks associated with the ruble’s drop. The currency’s 50 percent drop since the summer has caused a spike in inflation.
Higher interest rates can help a currency but also hurt economic growth by making loans more expensive.
Read more at Click here / www.trade4x.net
The move triggered a drop in the ruble, which was down more than 3 percent at 71 rubles against the dollar in early afternoon trading in Moscow.
The central bank explained its decision to cut the rate from 17 percent to 15 percent by saying that the risks of an economic slowdown are now higher than the risks associated with the ruble’s drop. The currency’s 50 percent drop since the summer has caused a spike in inflation.
Higher interest rates can help a currency but also hurt economic growth by making loans more expensive.
Read more at Click here / www.trade4x.net
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