The Russian central bank cut interest rates on Monday for the 14th time in 12 months and indicated that its foresees no further cuts at the present time, as the level should be correct for loans to be affordable and inflation to be contained.

Effective from Tuesday, the benchmark refinancing rate in Russia will be cut by 25 basis points to a new low of 7.75 per cent. This brings the cumulative easing since April of last year to 525 basis points.

The central bank announced: "The parameters set … create the conditions for the formation of money market rates which will enable an acceptable balance between the affordability of borrowing funds and inflation risks." The statement went on to say: “Consequently, the Bank of Russia thinks it likely that the achieved level of interest rates will be maintained in the coming months."

Economic figures for April indicated signs of a stronger recovery from recession than up to now in the country. At the same time banks’ lending activity has increased and rouble appreciation has eased.

Along with oil prices, both the Russian stock market and the rouble have come under pressure in recent weeks.

However, Nikolai Podguzov, fixed income analyst at Renaissance Capital, commented that, "a weaker rouble is more of a boon for the Russian economy".

The central bank has said the new rate level should not cause significant capital inflow, and that the current volatility level of the rouble exchange rate is acceptable.