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. Last Updated: 07/27/2016

Central Bank Slashes Refinance Rate

Russia's Central Bank said Friday it was cutting its key refinancing rate to 120 percent from 160 percent, taking effect Saturday.

The Central Bank last cut the refinancing rate from 170 percent on Dec. 1, after Sergei Dubinin was named bank chairman. Dubinin made it clear that while wedded to tight monetary policies, he wanted the cost of credit to come down in order to stimulate investment.

The rate cut had been preceded by a fall in treasury-bill yields, with the average yield falling to a record low 55.8 percent Thursday.

The Central Bank does not actually lend any money at the refinancing rate, but other commercial bank interest rates are tied to it.