(Adds detail, quotes, economist reaction)
SOCHI, Russia, Oct 10 (Reuters) - The Russian central bank is able to cut its key interest rate faster than previously thought thanks to steadily slowing inflation, Central Bank Governor Elvira Nabiullina said on Thursday, two weeks before a rate-setting meeting.
The central bank has cut its key rate three times in 2019 , saying more cuts are likely as inflation, its key area of responsibility, has fallen to its 4% target.
“We are seeing steady trends in inflation, which are allowing us to ease monetary policy faster than we previously thought,” Nabiullina told reporters.
Market experts said they took Nabiullina’s words as an indication that the central bank is ready to cut its key rate at this month’s policy meeting on Oct. 25.
Nabiullina said she would not comment on the extent of any interest rate cuts between now and the end of the year.
The final rate-setting meeting of the year is scheduled for Dec. 13.
Nabiullina said the central bank will revise down its inflation forecast before the end of the year, taking into account planned expenditure at the finance ministry.
“One of the significant factors is the dynamic of budget expenditures,” said Nabiullina. “We initially set out a neutral forecast for fiscal policy, but in fact fiscal policy has proved to be constraining.
“For us next year’s forecast concerning fiscal policy is important.” Economists from Citibank and VTB said they expect two more rate cuts, one each in October and December, leaving Russia’s key rate at 6.50% at the end of 2019 from 7.0% now.
Citibank said Russia’s central bank was “throwing in the towel” in the light of weaker inflation pressures.
Nabiullina was tight-lipped on how far rates might fall in the longer term.
“We are looking at several variants,” Nabiullina said. “Speaking now about how much the rate will be reduced, I cannot comment.” (Reporting by Tatiana Voronova; writing by Alexander Marrow; editing by John Stonestreet and Kirsten Donovan)