Russia’s Central Bank Lowers Key Interest Rate to 4.25% From 4.5%

Russia’s central bank cut its key interest rate to a new low Friday as the coronavirus pandemic pushed the country into a deep recession and forced President Vladimir Putin this week to delay a flagship $360 billion national development plan by six years.
The bank on Friday lowered its benchmark rate by 0.25 percentage points to 4.25%, following a 1 percentage point cut in June to a post-Soviet low. The bank’s move makes lending to businesses and consumers cheaper in an economy hit hard by a twin strike of lockdowns and lower oil prices.
In one of the starkest illustrations of the economic fallout, Mr. Putin on Tuesday reset his cornerstone economic plan to overhaul the economy and halve poverty. Known as National Projects, the program’s implementation was delayed to 2030 from an original target of 2024 and the government dropped some of its goals, including an aim for Russia to become one of the world’s top five largest economies. Russia is currently the world’s 11th largest economy measured by nominal gross domestic product, behind Canada and Brazil, according to World Bank data.