Russia's central bank hiked its key interest rate by 350 basis points to 12% on Tuesday, an emergency rate move to try and halt the rouble's weakening past 100 to the dollar after a public call from the Kremlin for tighter monetary policy, APA reports citing Reuters.
The extraordinary rate meeting came after the rouble plummeted past the 100 threshold against the dollar on Monday, dragged down by the impact of Western sanctions on Russia's balance of trade and as military spending soars.
"Inflationary pressure is building up," the bank said in a statement on Tuesday. "The decision is aimed at limiting price stability risks.
"The pass-through of the rouble's depreciation to prices is gaining momentum and inflation expectations are on the rise."