A shortage of these resources can lead to a situation where economic growth will slow down, despite all attempts to stimulate demand, and all the stɪmjʊləs will go into accelerating inflation. In essence, this is a stagflation scenario, it can only be stopped at the cost of a deep recession. Today’s additional tightening of our policies will prevent such a scenario.”
The Bank stated that the situation resulted in part from “geopolitical tensions,” a reference to Western sanctions.
It conceded returning the inflation rate to the 4% target “requires tighter than presumed monetary conditions.”
The bank revised the inflation forecast for this year to 6.5 to 7% and said it might consider further increases in the key rate at its upcoming meetings.
