Balance of risks shifting towards pro-inflationary ones — Central Bank chief

Lead

The Bank of Russia's governor, Elvira Nabiullina, said the balance of economic risks has shifted towards pro-inflationary factors, while also reassuring that the financial market is not facing systemic threats. Her comments came in remarks to journalists at press briefings and the Financial Congress in late June and early July.

Coverage Comparison

TASS — English reported Nabiullina's statements across several events, each focusing on a distinct aspect of the central bank's outlook. One report from a press conference following the Bank's Board meeting highlighted her assessment of inflationary risks. Another, from a briefing at the Financial Congress in St. Petersburg, addressed financial market stability and transparency. A third report, also from the Financial Congress, focused on her remarks about interest rates and loan availability.

The reports collectively portray a central bank that acknowledges growing inflationary pressures but rejects the idea of systemic financial instability. The tone across the coverage is largely informative, with direct quotes from Nabiullina used to convey the official positions.

Key Claims

Shift Toward Pro-Inflationary Risks

Nabiullina told reporters after a Board meeting that, according to the Bank of Russia's estimates, the balance of risks has shifted more towards pro-inflationary ones. She did not specify the precise drivers but referenced the global economic context, particularly the Middle East.

Middle East Conflict and Import Prices

Nabiullina said risks of conflict protraction in the Middle East had become lower, but uncertainty remains about the scale of its pro-inflationary implications for the global economy. She added that these risks could affect the Russian economy through prices of imported goods and logistical expenses.

No Systemic Risks for Financial Market

At the Financial Congress briefing, Nabiullina stated that there are no systemic risks for the financial market. She noted that the central bank regularly presents reports on financial market risks, reviewing and demonstrating them, and that the institution is "sufficiently public and transparent" in this regard.

Interest Rates and Loan Availability

Nabiullina emphasized that the Bank of Russia is not a supporter of high interest rates. "We are not the fans of high rates. The loan should be affordable," she said. She argued that fair competition conditions should also be in place, but this is not an issue of the key rate—it is an issue of inflation. Thus, the availability of loans depends primarily on the level of inflation, not the key rate.

Caution on Economic 'Cooldown'

In the same remarks, Nabiullina urged caution when using the notion of economic "cooldown," though she did not elaborate on this point in the reported text.