Russian Business Chief Calls for 1% Interest Rate Cut at Central Bank Meeting

Alexander Shokhin, head of the Russian Union of Industrialists and Entrepreneurs (RSPP), has called on Russia's Central Bank to cut its key interest rate by 1 percentage point at its scheduled meeting on June 19, 2026. Shokhin argued that with inflation slowing to 5.31% in May, a more aggressive rate reduction is economically justified and necessary to stimulate business activity.

Shokhin emphasized that businesses face persistent headwinds, with May's RSPP business climate index showing continued demand weakness, ongoing payment difficulties, and sharply reduced investment programs. He stated that the prolonged period of elevated rates has negatively impacted corporate investment activity and economic performance. Additionally, high rates increase government spending on debt servicing, he noted. "For the Russian economy not to freeze completely, business needs not a thaw but summer warmth," Shokhin said, calling for predictable signals and accelerated rate cuts from authorities.

The Central Bank last reduced rates by 50 basis points on April 24, lowering them from 15% to 14.5% annually. Most analysts surveyed by Vedomosti expect another 50 basis point reduction at the June 19 meeting, bringing rates to 14%. Of 19 expert forecasts, 14 predicted this outcome, while others anticipated more modest cuts or maintained rates. Some analysts suggest a 25 basis point reduction is possible due to increasing inflation risks. Central Bank officials have signaled they will evaluate the case for further easing at upcoming meetings, but stressed this does not guarantee rate cuts at each session.