Russia increases rates to 15% due to soaring inflation

Russia‘s main bank has raised its main interest rate to 15% in an attempt to reduce inflation and strengthen the value of the currency.

The interest rate has increased by more than expected, going up by two percent. This means that it is now more expensive to borrow money, and it is the fourth time in a row that this has happened.

The prices of things have been going up very quickly all around the world, partly because of Russia invading Ukraine. In September, the inflation rate in Russia reached 6%.

The Russian government has been spending more money on its military.

The Bank of Russia, which is the central bank of the country, has increased interest rates by 7. 5 percentage points since July. Their goal is to bring down inflation to their target of 4%.

This means that there was a sudden and unexpected increase in prices in August when the value of the rouble fell below 100 to the dollar, and the government asked for stronger control over the country’s money.

On Friday, it was mentioned that the current increase in inflation is higher than what the Bank of Russia had predicted.

People wanted to buy more things and use more services than there were available. This caused the amount of money borrowed by banks to increase.

The coronavirus pandemic caused problems in getting goods to people, which made prices go up. Then, in February 2022, when Russia invaded Ukraine, it also caused problems in getting enough food around the world and made energy costs increase.

Rising food and energy prices are big reasons why prices in general are going up all over the world.

The Russian economy is also facing more pressure because the country is buying more things from other countries than it is selling, and also because it is spending more money on its military for the war in Ukraine.

Russia was punished by countries in the West because it attacked Ukraine.

The rouble dropped in value when the war started, but it increased again because the government put restrictions on transferring money out of the country and because they earned a lot of money by selling oil and gas.

But, the currency has become worth about 25% less compared to the US dollar since the conflict started.

The Bank of Russia has increased interest rates by a large amount before. When Russia initially attacked Ukraine, the bank increased interest rates from 9. 5% to 20% However, they started decreasing the rates shortly afterward.

However, increasing interest rates can only do so much to stabilize an economy, and experts believe that Russia may face difficulties in attracting investment because of the sanctions imposed by Western countries.

Economists have said that one of the main reasons for the decline in the rouble is because Russia’s trade has been negatively affected by the sanctions.

Since the war started, several European Union countries that depended on oil and gas from Russia have promised to reduce their reliance on imports from Russia. Many of these countries have now found other sources to get their oil and gas from.

EU leaders have made a plan to control the amount of money Russia makes from selling oil, and they have also stopped Russia from using a payment system called Swift, which is used by many banks.

The European Commission said that the sanctions against Russia are effective.

The blog post in August mentioned that the amount of coal being sent out of the country has decreased, and the production of oil in the country has dropped by over 25%.