"The Bank of Russia Board of Directors decided to increase the key rate by 350 basis points to 12.00% per annum from 15 August 2023. The decision is aimed at limiting price stability risks," the central bank said in a statement.
The statement said that annual inflation in Russia increased to 4.4% as of August 7 as price growth continued to accelerate.
"Inflationary pressure is building up. As of 7 August, the annual rate of inflation rose to 4.4% while current price growth rates continue to increase. Over the last three months current price growth amounted to 7.6% on average in annualised terms on a seasonally adjusted basis. The same core inflation measure went up to 7.1%," the bank stated.
The document also said that the bank's decision is aimed at shaping monetary conditions and "overall domestic demand dynamics necessary to bring inflation back to 4% in 2024 and stabilise it close to 4% further on."
"According to the Bank of Russia's forecast, given the monetary policy stance, annual inflation will return to 4% in 2024," the bank added.