Russia’s former deputy prime minister and finance minister Alexey Kudrin said the central bank made the right move hiking the interest rate from 10.5% to 17%.

“The Central Bank’s decision to raise the rate to 17% is a forced one but correct decision in the current conditions,” Kudrin wrote in his Twitter account.

Russia’s Central Bank took a decision early on Tuesday to hike the key rate determining the borrowing cost for commercial banks to 17% from 10.5%

Simultaneously, the regulator increased the limits of foreign currency repo auctions for a term of 28 days to $5 billion from $1.5 billion. The regulator will also hold similar auctions for a term of 12 months every week. The Central Bank will provide loans against non-market assets for a term of 2 to 549 days at a floating rate comprising the key rate plus 1.75%

The regulator said in a statement its decision to increase borrowing costs for commercial banks was prompted by the need to restrain devaluation and inflationary risks that had sharply increased lately.