Central Bank of Russia cuts key rate to 14% in surprise move, lowers GDP growth outlook

The Central Bank of Russia unexpectedly reduced its key interest rate by 25 basis points to 14%, diverging from market expectations of a hold. Simultaneously, the regulator raised its 2026 inflation forecast to 6%-7% and downgraded GDP growth projections to 0%-1%, signaling a shift in monetary policy despite persistent fuel supply constraints and high military expenditure.