MOSCOW, March 13 (UPI) -- The Central Bank of Russia cut its interest rate again Friday, to 14 percent, to stimulate growth despite economic sanctions.
It moved the interest rate from 17 percent to 15 percent in January, and said additional reductions are under consideration. An increase from 10.5 percent to 17 percent In December, to combat inflation and prop up the faltering ruble, is regarded as a failure.
Annual inflation in Russia was measured at 16.7 percent in February, and in the past year the ruble has lost 70 percent of its value against the U.S. dollar. After Friday's announcement, the ruble strengthened to 61.3 to the dollar, from 61.5 to the dollar.
Elvira Nabiullina, chairwoman of the Bank of Russia, said she foresees Russia's economic decline, forced by sanctions and by lower prices for oil, the country's largest export, bottoming out by the first quarter of 2016. Official data indicates inflation has slowed thus far in 2015, largely because of lower incomes and a decrease in consumer demand.
Russia's new government budget predicts a three percent decline in growth in 2016. It expects an increase in manufacturing, tourism and agriculture to partially offset the loss of oil revenues.
