Ruble on mend as Russia's central bank cuts key interest rate

Russia's central bank says it's lowering a key interest rate, and said more cuts could be on the way.

The decision indicates the bank thinks strict capital controls and other severe measures are stabilizing Russia's currency and financial system despite intense pressure from Western sanctions over the war in Ukraine.

The bank said Friday it lowered its benchmark rate from 20% to 17%, effective Monday. It had raised the rate from 9.5% on Feb. 28 -- four days after the invasion -- as a way to support the ruble's plunging exchange rate.

A currency collapse would worsen already high inflation for Russian shoppers by ballooning the cost of imported goods.

The rate increase shows how the central bank has managed to stabilize key aspects of the economy with severe controls, artificially propping up the ruble to allow it to rebound to levels seen before the invasion of Ukraine even as the West piles on more sanctions.