THE KEY RATE OF THE CENTRAL BANK. WHY IS HER SIZE SO IMPORTANT?

In Russia, the key rate is 2 times higher than the inflation rate. A high key rate is beneficial to those who deposit money at high interest rates. Today, 63 trillion rubles are deposited in banks, of which 50 trillion belong to citizens, the rest of the money was deposited by enterprises. This is good for depositors, they receive interest income. This is also good for banks, they received money at an interest rate below the key rate and, therefore, they do not need to borrow money from the Central Bank at the key rate. But the high key rate has a lot of problems. High deposit rates attract everyone and instead of investing money in the development of production, money goes to banks and is washed out of the economy, economic development slows down, and this is unacceptable in the conditions of its own. According to the Central Bank, the increase in the key rate is usually due to the desire to take control and reduce inflation. But this only warms up inflation, the purchasing power of the population increases due to interest income, and the pace of economic development subsides from lack of money. The commodity mass is decreasing and becoming more expensive.