Russia’s central bank hikes key rate to 20%

MOSCOW: Russia’s central bank announced on Monday it was raising its key interest rate to 20 per cent from 9.5 per cent as the West pummelled the country with sanctions over Moscow’s invasion of Ukraine.

“The Bank of Russia’s board of directors has decided to raise the key rate to 20 per cent,” the central bank said in a statement.

It said it was taking the emergency measure because the Russian economy’s situation had “drastically changed”.

The bank said that this would allow it to “support financial and price stability and protect citizens’ savings from depreciation”.

The Russian ruble has plunged in value to historic lows after world powers imposed fresh, harsher sanctions on Moscow over its invasion of Ukraine.

When trading opened on Monday on the Moscow Stock Exchange, the ruble was trading at 90 rubles to the dollar and 101.19 to the euro.

The central bank on Monday morning also announced a compulsory measure for companies based in Russia that earn foreign currency through exports to sell currency amounting to 80 per cent of their earnings.