Russian central bank lays ground for another hike

Russian central bank governor Elvira Nabiullina’s hawkish post-meeting press conference reinforced our impression that another hike in interest rates is likely over the next few months. We now expect a 25bp hike to 8.00% early next year. We have revised up our end-2019 forecast for the repo rate to 8.00% (previously 7.50%) and, while some easing still seems likely beyond that, we have changed our end-2020 forecast to 7.00% (previously 6.50%).