Page 85 - RusRPTOct21

investment in Tochka has totalled RUB2.1bn and the company has received RUB0.6bn in dividends from Tochka, according to Qiwi. Qiwi's stake in Tochka is accounted for by the equity method. It contributed RUB323mn to Qiwi's net profit in 1H21 and RUB785mn in 2020.
8.2 Central Bank policy rate
Surprisingly for the market, the CBR raised ratesy only 25ps on September 10. However, the accompanying press release sounded more hawkish than in July.
By doing so, the CBR signaled its intention to return to a more gradual adjustment of monetary policy. This approach can be attributed to the high uncertainty about the macro conditions and having already delivered substantial tightening this year.
On the other hand, it signaled that the hiking cycle is to continue without any predetermined ceiling.
In light of this, analysts expect the CBR to continue hiking in 25p increments until the run rates of inflation return to 4% in annualized seasonally adjusted terms.
That is unlikely to happen at least until the beginning of 2022, which means that hikes in October and December are quite likely.
Sberbank CIB’s key rate projections for 2021 and 2022 remain intact at 7.25% and 6.00%, respectively.
The CBR explained its actions in a statement:
On 10 September 2021, the Bank of Russia Board of Directors decided to increase the key rate by 25.p. to 6.75% per annum. In 2021 Q2, the Russian economy reached its pre-pandemic level and is, according to bank of Russia estimates, returning to a balanced growth path. The contribution of persistent factors to inflation remains considerable on the back of faster growth in demand relative to output expansion capacity. In this environment, given high inflation expectations, thealance of risks for inflation is tilted to the upside. This mayring about a more sustained deviation of inflation from the target. The Bank of Russia’s monetary policy stance is aimed to limit this risk and return inflation to 4%.
If the situation develops in line with the baseline forecast, the bank of Russia holds open the prospect of further key rate rises at its
85 RUSSIA Country Report October 2021 www.intellinews.com