**Russia Keeps Interest Rate at 21%, Defying Expectations**
Russia’s Central Bank has decided to keep its benchmark interest rate steady at 21%. This decision goes against expert predictions of an increase. The bank has been raising the interest rate since July 2023 to combat inflation caused by war spending.
The interest rate has risen from 7.5% in July to 21%, the highest level since the early 2000s. However, businesses in Russia’s military-industrial complex have criticized this move, saying it will lead to economic problems.
Russian President Vladimir Putin recently spoke about the issue, suggesting that other tools should be used to fight inflation instead of just raising interest rates. Most analysts expected a hike of 200 basis points to 23%.
**Conflict Over Interest Rates**
The Central Bank’s chief, Elvira Nabiullina, has been involved in a conflict with Sergei Chemezov, the CEO of Russia’s state-owned defense giant Rostec. Chemezov says that if interest rates continue to rise, most enterprises will go bankrupt.
However, former economic advisor Vladimir Milov says that both sides have valid concerns. “Chemezov is right that businesses will shut down at such a high interest rate,” he said. “Nabiullina is right that the rate cannot be cut because there will be hyperinflation like in Turkey.”
**Ukraine Receives U.S. Funds**
Ukraine has received U.S. funds under the framework of the G7’s $50 billion loan, which is covered by profits from frozen Russian assets. This comes as Ukraine continues to face challenges, including a recent missile attack on the capital.
Russian attacks against Ukraine killed seven people and injured at least 34 others over the past day, regional authorities said. The bodies of 403 soldiers were recovered from Donetsk Oblast, while 57 and 12 bodies were brought back from Zaporizhzhia and Luhansk oblasts.
Read More @ kyivindependent.com