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- Double-digit answer: The Central Bank has planned a reduction in the key rate in 2027
Double-digit answer: The Central Bank has planned a reduction in the key rate in 2027
The reduction of the key rate in Russia will continue next year — this is provided for in the baseline scenario, the head of the Central Bank emphasized in a speech to the relevant committees of the State Duma on the Central Bank's report. However, the indicator is likely to remain in double digits throughout 2027. According to Elvira Nabiullina, there are no signs of a hypothermia in the economy right now: on the contrary, since the middle of the year there have been more and more signals of a resumption of restrained growth. The shortage of personnel is also gradually decreasing, although it will not completely disappear in the foreseeable future. What level the key one may drop to, how it will affect business activity and why rapid monetary policy easing should not be expected - in the Izvestia article.
What will be the key rate in 2027
In the baseline scenario, the Bank of Russia expects to continue reducing the key rate in 2027, but does not expect a quick return to single-digit values. This was announced by the head of the regulator, Elvira Nabiullina, speaking before the relevant committees of the State Duma.
— Attacks on our refineries, other industrial enterprises, data centers, logistics centers have limited production capabilities. We believe that this is temporary, as both the business itself and the government are making tremendous efforts to restore the affected facilities. While this recovery process is not completed, demand should grow at a restrained pace, there is no question of a decline in the economy's GDP, but excessive demand growth in the current circumstances may accelerate inflation. This cannot be allowed," explained the chairman of the Central Bank.
Further easing of monetary policy, according to her, will depend on how quickly enterprises can restore production capacity, and inflation will slow down. As the output of goods and services expands, the pressure on prices should ease, which will allow the regulator to lower the rate.
Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market, and Elvira Nabiullina, Chairman of the Bank of Russia.
In the base scenario of the Central Bank, the average key rate next year will be 12.5–13.5% per annum. At the same time, we are talking about the average value for the year, and not about the rate at the end of 2027.
Peter Arronet, Chief Analyst at Ingo Bank, noted that such a range looks realistic. In turn, Alexander Ivanov, chief economist at Ingosstrakh Investments Management Company, focuses more on the upper bound of the Central Bank's forecast. According to him, by the end of 2027, the key rate will not fall below 13%. At the same time, the expert does not expect that inflation, even under such circumstances, will decrease to the target 4%. Most likely, next year the price increase will be at the level of 6-7%, the expert believes.
Under more favorable conditions, the regulator may reduce the rate to 10-11%, says financial advisor and founder of Rodin.Capital Alexey Rodin. But this will require a steady slowdown in inflation and an improvement in the economic situation. In general, analysts do not expect a sharp easing of monetary policy.
Why the economy is not supercooling
Despite the long period of high interest rates, there are no signs of a hypothermia in the economy now, Elvira Nabiullina emphasized. Such a situation could be evidenced by an increase in unemployment, a decrease in real incomes of the population and inflation below the target level. So far, these trends have not been observed. On the contrary, by mid-autumn, there were more signals of a resumption of subdued economic growth.
However, the capacity of enterprises to increase output remains limited. In the near future, demand should grow moderately, the head of the Central Bank noted. If citizens and companies increase spending faster than manufacturers can increase the output of goods and services, there will be a shortage of supply, and prices will begin to rise more rapidly.
The labor market situation remains an additional constraint. The personnel shortage has softened somewhat, which is confirmed by surveys, but there are no prerequisites for its complete disappearance in the foreseeable future, said the chairman of the Central Bank.
Easing staff shortages could curb the growth of salaries and business costs, which means that inflationary pressures will decrease over time. However, this process has not yet become sustainable, Alexander Ivanov noted. According to the monitoring data of the Central Bank enterprises, in the third quarter of 2026, companies' expectations for an increase in wages decreased slightly on average, but in industry and manufacturing, on the contrary, increased.
At the same time, the growth of production capacity is important not only for economic recovery, but also for further reduction of inflation. The more goods and services enterprises can produce, the less risk there is that an increase in demand will lead to an acceleration in prices. That is why the Central Bank associates further policy easing with the restoration of production and an increase in labor productivity.
The resumption of subdued economic growth in the future will be evidenced by the dynamics of corporate lending and GDP, as well as an improvement in business activity indices, Petr Arronet added.
What prevents you from lowering your bid faster?
Elvira Nabiullina called the high proportion of concessional loans one of the factors complicating the work of monetary policy. According to her, the 8-9 percentage point gap between the key rate and inflation is related to two features of the Russian economy: prolonged inflationary pressure and large-scale government-backed lending.
The problem is that borrowers with access to preferential programs continue to receive money at rates that are poorly dependent on the decisions of the Central Bank. Therefore, the increase in the key does not limit their demand so much compared to other citizens and companies. As a result, the regulator has to maintain stricter conditions for market borrowers in order to contain inflation in general, said Andrey Glushkin, managing partner of the Main Division and member of the General Council of Delovaya Rossiya.
The problem is not only with popular mortgage programs. As of September 1, 2026, the volume of corporate loans at preferential rates amounted to 4.7 trillion rubles, or 5.8% of the total loan portfolio to enterprises, the Bank of Russia estimated. At the same time, subsidies help support individual industries, including housing construction and industry. Its sharp reduction could hit investment and production, said Boris Kopeikin, chief economist at the Stolypin Institute for Growth Economics.
In addition, the reduction in government support alone will not lead to a rapid decline in key support, says Freedom Global analyst Vladimir Chernov. According to him, the difference of 8-9 percentage points is explained not only by the volume of concessional loans, but also by the continuing high inflation expectations. Even if the share of such loans decreases, the population and businesses will continue to take into account the risk of rising prices when making financial decisions.
A further reduction in the key rate will depend on a range of conditions: slowing inflation, restoring production capacity, cooling credit demand, as well as on the consistency of fiscal and monetary policy, experts predict. So far, it is not necessary to count on a quick return of the rate to single-digit values.
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