Russia’s central bank raised its benchmark interest rate by 100 basis points to 19% at a board meeting today, saying inflation remains persistently high and tightening is needed to bring it down.

A Reuters poll of 27 analysts ahead of the decision had predicted that the regulator would keep interest rates unchanged at 18%amid early signs of a slowing economy.

But the latest inflation data released on Thursday showed that inflation is still high and the central bank said there are still risks from it.

“Overall, persistent inflationary pressures remain high and have yet to show signs of abating,” the central bank said in a statement.

Seasonally adjusted core inflation accelerated in August to 7.7% from 6.1% in July, according to the central bank’s calculations, with many analysts saying this rise triggered today’s decision.

Overall inflation slowed to 9.05% in August on an annualized basis, down slightly from 9.13% in the previous month. Since the beginning of the year, prices have increased by 5.35%.

The latest macroeconomic forecasts showed inflation for the whole year at 7.3%, well above the central bank’s 4% target.

The central bank had earlier announced that inflation peaked in July and will gradually decline towards the end of the year.

According to forecasts, the government now expects Gross National Product (GDP) to grow by 3.9% in 2024, up from 2.8% in a July forecast. This new rate indicates a slowdown in growth, which was at 4.6% in the first half of the year.

“This slowdown is likely to be mainly related not to a decline in domestic demand, but to an increase in supply-side constraints and a reduction in external demand,” the regulator said, referring to the impact of Western sanctions that have disrupted Russia’s trade with its main trading partners, including China.

The central bank, in a monetary policy draft published last month, announced that it would need to stick to a tight monetary policy for an extended period to achieve a sustainable reduction in inflation.

Business lending growth, another major factor behind high inflation and economic overheating, accelerated to 2.3 percent in July from 1.5 percent in June, according to the latest available data, despite high interest rates.

“The central bank’s decision will accelerate the formation of the necessary monetary and credit conditions to increase savings activity and return lending to balanced growth,” the regulator said.

The board’s next meeting is scheduled for October 25, and some analysts are already suggesting the regulator will continue its tough policy.

“The decision showed a clear intention, at least for now, to continue the rate hike in October,” Renaissance Capital analyst Oelg Kuzmin said.