OREANDA-NEWS The Central Bank has reduced the key rate by three percentage points to 11 percent per annum, according to the regulator's website.

The decline occurred at an extraordinary meeting of the Board of Directors of the Central Bank, which was announced on May 25. The rate cut was expected, since the management of the regulator, headed by Elvira Nabiullina, had repeatedly talked about this possibility earlier.

"The inflow of funds for term ruble deposits continues, and credit activity remains low. This limits pro-inflationary risks and makes it necessary to ease monetary conditions," the report says.

It is also noted that the external conditions for the Russian economy remain difficult, which significantly limits economic activity: "The risks to financial stability have somewhat decreased, making it possible to mitigate certain capital controls."