Russian central bank raises interest rates

The Russian central bank said Monday it had decided to raise its interest rates by 25 basis points to mop up surplus liquidity on its money markets. The move contrasts with action taken by other central banks around the world which have been putting money into the banking sector to increase liquidity amid fears of a credit crunch.
Short-term deposit rates in Russia are to increase from Tuesday to 2.75-3.25 percent from 2.5-3.0 percent. "We hope that this measure will enable us to freeze the movement of surplus liquidity and will help us to meet our inflation targets," Bank of Russia deputy-chairman Alexei Ulyukaev told Prime-Tass news agency.