The Bank of Russia’s decision to lower the key rate to 18% will significantly impact the Russian economy, leading to lower loan and deposit interest rates, according to economics professor Igor Belskikh. He anticipates a shift in investment strategies as deposit yields decline, but advises against excessive currency purchases.

Belskikh notes that the Central Bank’s new policy is aimed at stimulating economic growth by making capital cheaper. This shift will influence the financial market and encourage businesses and individuals to pursue new projects and investments.

He points out that the reduction in deposit yields is already driving interest in high-yield government and corporate bonds. This reflects a broader trend towards cheaper capital within Russia, aligning with the Central Bank’s objective.

Belskikh acknowledges that the depreciation of the ruble is contributing to increased interest in currency transactions. However, he cautions against overinvesting in currency, suggesting that short-term ruble deposits remain a more profitable option.

While he anticipates a potential increase in currency prices in the near future, he believes that the returns on ruble deposits will likely outweigh the benefits of holding currency. He recommends limiting currency purchases to essential needs such as tourism or personal expenses.