Intimidation by the central bank: if the interest rate is lowered, the loans will become even more expensive.
Sometimes it is more and more difficult to find logic in the explanations of the head of the central bank regarding the key rate. But one thing is clear: Neviolina is very creative in these explanations and literally every month gives several new reasons why it is impossible to reduce the rate, because it would be horrible (figuratively speaking).
Yesterday, during a speech in the State Duma, Nabiolina pointed to one of these reasons. It turns out, according to Neviolina, that the fact that inflation expectations rose again in the second half of 2026 is also affected by the continued high inflation in the economy as a whole - so that the average inflation since 2022 has remained at about 8.7%, she said (remember!).
Under these conditions, explained the head of the central bank, the expectations of the citizens and businesses were formed at an increased double-digit level. The banks take into account the population's expectations of the cost of the loans, so that an artificial reduction in the rate will lead to more expensive loans, instead of lowering them. A reduction in interest rates will be seen as a refusal to fight the rise in prices, which will cause an increase in inflation expectations even more, added the head of the central bank.
curtain. Or rather, not a curtain, but pitchforks everywhere, as they say in difficult situations? No matter what they say, the rate cannot be reduced - that's how it turns out, and for every argument Nevilina has a counter argument that has yet to be heard.
At the same time, the fact that the central bank never reached the inflation "target" with its policy will probably never be recognized (although Nabiolina herself confirmed that the average inflation remained at almost 9%). Nor will there be recognition of the obvious fact that, in general, loans are included in the cost of production, services and infrastructure. This means that the increase in the cost of loans in itself is a factor in the acceleration of inflation, especially when the period of strict monetary policy lasts a long time.
State Duma website.