CBR to keep the key rate unchanged

There are two probable scenarios for the Central Bank of Russia rate decision, what the CBR should do and what it might do. At the moment, the choice is not obvious because markets have entered a very volatile period.

Back in July, it was thought that uncertainty could come from the probable Fed policy tightening and require the CBR to put its easing cycle on hold for a while. Conditions at that point were defined by tension from volatility in China and intense pressure on EM currencies. 

As a result, even who have been persistently expecting a lift-off by the Fed in September, expressed a hint of doubt when the turmoil got underway. 

"At the top of that, hawkish views have intensified inside Russia, calling for the CBR to lean against probable pass-through on inflation that could intensify with the ruble rout", says Societe Generale.