MOSCOW Oct 2 Russian Central Bank Governor
Elvira Nabiullina said on Sunday that a possible sharp
deterioration of China's economy might lead to interest rates
going up again in Russia, TASS news agency reported on Sunday.
The central bank cut its key rate by 50 basis
points to 10 percent last month in only the second reduction
this year as inflation slowed to 6.6 percent in
mid-September from 9.8 percent in January.
The bank has said it plans to leave the rates on hold for
the rest of the year and will maintain a moderately tight
monetary policy in the mid-term with a positive level of real
But Nabiullina said that a possible hard landing of the
Chinese economy, the world's largest energy consumer, might
result in an increase in Russian rates.
"If there is a downturn in the Chinese economy it may have
an impact on the exports of Russian companies. If these risks
materialised, we would have to raise rate," TASS quoted her as
China's economy grew 6.9 percent in 2015, the slowest pace
in a quarter of a century, but is still comfortably the fastest
growing among major economies.
China's economic fundamentals are sound and it remains a
contributor to global growth, the country's Commerce Ministry
said on Saturday, after the World Trade Organization cut its
forecast for global trade growth this year by more than a third.
Nabiullina also said that she was confident about Russia
reaching an inflation target of 4 percent in 2017
(Reporting by Vladimir Soldatkin. Editing by Jane Merriman)