Nabiullina said that hardline monetary policy does not suppress economic growth in Russia

The hardline monetary policy of the Central Bank does not suppress economic growth in Russia, retail and corporate loan volumes are rapidly increasing, as stated by Elvira Nabiullina, Governor of the Central Bank of Russia, at a macroeconomic session of the 13-th «Russia Calling!» forum by VTB Capital

«We see that our policy is not restrictive for economy growth rates, because loan volumes are rapidly growing — not only retail loans that we are cooling down, but corporate loans as well: the latest data shows that these are above 11%», — said Nabiullina.

She noted, that this monetary policy together with the economic policy enable the authorities to achieve economic growth without price surges. Russians, according to her, have become very price-sensitive and feel «hurt» by the inflation, said Nabiullina.

This year the CBR has raised the key rate six times in an attempt to curb price growth. This spring the regulator increased the rate by 0,75 pp, this summer— by 1,5 pp, this fall— by another 1 pp, bringing it up to 7,5% per annum. This helped slow annual inflation as at November 22 down to 8,05%. The CBR intends to bring the key rate to a neutral level of 5-6% no earlier than 2023.

According to the CBR, in October the inflation in Russia accelerated up to 8,13% YoY from 7,4% the month before due to higher food inflation. As at November 22 it slowed down to 8,05%. As per the October CBR forecast, this year’s annual inflation will range from 7,4 to 7,9%, next year— from 4 to 4,5%, and then inflation will stay around the target of 4%.