Russian central bank leaves key rate unchanged despite inflation pressure

Russia's Central Bank on Friday announced a decision to leave the key interest rate unchanged at 8.25 percent despite the pressure of inflation. According to a Central Bank statement, consumer prices in the country rose by 6.6 percent in September, mostly due to the food price hike and the rising government-regulated tariffs in recent months. The Central Bank also noticed that main macroeconomic indicators in August showed "some cooling of economic activity," with slower growth in industrial production, investment rates and consumer demands. However, the unemployment rate remained low and it did not worsen in August and September, which upheld the environment for consumer demand growth, the Central Bank said while explaining its decision. Besides, "the risks of significant slowing of economic growth currently were small," it added. On Sept. 13, the Central Bank unexpectedly raised the key interest rate by 0.25 percentage point to 8.25 percent, the first time since December 2011, in response to food price hike and leap of regulated tariffs. The Central Bank's next decision over the interest rates is expected to be made in early December. The Russian Ministry for Economic Development has forecasted that the country's inflation rate would reach 7 percent by the end of 2012.