Russia’s Economy Minister Maxim Reshetnikov on Monday called on the central bank to factor in slowing inflation when it meets next week to set interest rates, warning that the economy shows signs of “hypothermia.”
The central bank has kept its key interest rate at 21% since October to combat persistent inflation, a policy that has restrained investment as the impact of rising military spending begins to ease.
President Vladimir Putin in March urged officials not to “freeze” the economy with high borrowing costs, a move analysts saw as a signal to start easing monetary policy.
Speaking in the State Duma, Russia’s lower house of parliament, Reshetnikov said recent inflation figures have been between 3% and 4% on an annualized basis. He expects May data to confirm the trend.
“We expect that the central bank will duly take this into account when taking decisions because we also see risks of economic hypothermia in the current regime,” Reshetnikov said.
The ministry projects annual inflation at 7.6% for 2025, a figure Reshetnikov called “realistic.”
Meanwhile, major exporters such as Rusal and Gazpromneft have reduced planned shipments of commodities by rail, according to a Russian Railways document reviewed by Reuters, reflecting subdued demand amid the economic slowdown.
The central bank’s next rate-setting meeting is scheduled for June 6.
