The easing of credit conditions will occur not only in the form of a reduction in market interest rates, but also in the form of correction of non-price credit conditions, notes the regulator.
MOSCOW, 10 Nov. Dynamics of interest rates of banks on credits and deposits, as well as market yield curve will react to changes in the key rate with a lag of up to six months, stated in the final version of the draft basic directions of monetary-credit policy of the Bank, which was approved by the Board of Directors of the Central Bank.
“Changing the key rate will be with a lag of up to six months consistently move into the dynamics of Deposit and loan rates and market yield curves”, — said the regulator.
The easing of credit conditions will occur not only in the form of a reduction in market interest rates following the key interest rate of the Bank of Russia, but also in the form of correction of non-price lending conditions: mitigation will be supported by improved assessment of the financial condition of borrowers, including the reduction of the accumulated debt burden by maintaining at the first stage, the slow pace of growth of credit to economy with moderately tight monetary policy, says the Central Bank.
The Bank of Russia expects that the relatively restrained dynamics of incomes and consumer demand in the conditions of realization of conservative fiscal policy and moderately tight monetary policy will be a key condition for the consistent continuation of slowing inflation and its convergence to the target level in 2017-2018 (4%).
As inflation and inflationary expectations, the Bank of Russia will reduce the key rate. Nevertheless, changing interest rate policy will be of a smooth nature, and to a sustainable stabilisation of inflation at a low level, monetary policy will remain moderately firm, notes the regulator.
“This is necessary not only from the point of view of ensuring price stability, but also to maintain financial stability. The main domestic source of risk for the latter may be excessive the acceleration of growth of credit load, the dynamics are not proportional to income of the economy possible in the case of excessive easing financial conditions,” explained the Central Bank.