The Central Bank of Russia, despite recently lowering the key rate, is signaling a potential increase if inflation accelerates. Banks have already started reducing deposit interest rates, leading to concerns among depositors.

The average rate on a six-month deposit in major Russian banks has fallen to a historic low since October 2024, currently standing at 19.3%, while one-year deposits average 18.6%. Banks anticipate depositors will seek to secure current high rates by opting for longer-term deposit products.

Financial advisor Alexey Rodin recommends opening long-term deposits to lock in current high rates, as deposit yields are expected to decline. He also suggests considering long-term government bonds with fixed coupons, as their market price should increase as the key rate decreases.

Head of Deposits at Sravni, Ilya Vasilkov, explains that banks are reducing deposit yields in anticipation of further key rate decisions by the Bank of Russia to balance their margin. Vasilkov forecasts that the key rate could reach 18-19% by the end of the year, with average deposit rates falling to 16-17%.

Vice President of Finance at the Association of Electronic Trading Companies (APET), Anna Baranova, predicts no significant outflow of deposits despite the rate reduction, as deposits remain the most understandable and accessible savings tool for most citizens. Baranova cautions against riskier investments like the foreign exchange market, stocks, OFZs, or gold, as they require financial knowledge and tolerance for fluctuations.

Deposits up to 1.4 million rubles are insured by the state, offering security despite declining returns. In an unstable economic climate, people prioritize capital protection, and there’s a prevailing trust in the banking system, particularly among major players, mitigating the incentive to switch to riskier investment options.