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UPDATE 1-Russia says ready to use interest rate to offset external shocks like new sanctions
November 10, 2017 / 4:48 PM / 11 days ago

UPDATE 1-Russia says ready to use interest rate to offset external shocks like new sanctions

(Recasts to adds details on interest rate mechanism)

MOSCOW, Nov 10 (Reuters) - Russia’s central bank said on Friday it was ready to use interest rates to offset the fallout from any external shocks such as new Western sanctions.

The bank said in a statement it was conducting various stress tests to assess the impact of any new financial sanctions other countries might impose on Moscow.

It said it wanted to understand how well the financial sector would be able to adapt and said it was ready to use its control over the key rate to maintain financial stability in the event of any “shock events.”

The United States and the European Union imposed sanctions on Russia after it annexed Ukraine’s Crimea in 2014 and after an uprising by pro-Russian separatists in eastern Ukraine broke out that same year.

U.S. intelligence agencies have accused Russia of interfering in last year’s U.S. presidential election, something Moscow flatly denies, spurring calls in the United States for tighter sanctions on Russia.

In December 2014, in the wake of Russia’s annexation of Crimea, the central bank abruptly hiked the key rate to 17 percent to avoid a run on the rouble and market panic. (Reporting by Elena Fabrichnaya; Editing by Andrew Osborn)

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