Russia's central bank pauses interest rate hikes as political pressure grows

Russia's central bank has halted interest rate increases amid growing political pressure from industrialists affected by rising rates. This marks a shift from previous support for rate hikes, as the Kremlin responds to concerns about the economy overheating due to war spending. Central bank governor Elvira Nabiullina announced plans to use alternative tools to manage inflation, citing a slowdown in lending. The bank will raise capital and liquidity requirements for banks to enhance financial stability, rather than relying solely on interest rates. The central bank's recent actions include increasing capital charges for banks lending to large businesses. Meanwhile, the real estate sector faces challenges as government mortgage subsidies end, leading to a decline in apartment sales and significant losses for major developers.