UPDATE 1-Russia central bank holds rates, signals easing
(Adds context, details from central bank statement)
MOSCOW, July 12 (Reuters) - Russia's central bank kept key interest rates on hold on Friday and signalled policy easing ahead, warning in a statement of risks to economic growth while downplaying inflation concerns.
The decision is the first since former Kremlin economic aide Elvira Nabuillina became the bank's chairwoman, a change many analysts predict may tilt the bank towards a less hawkish stance than under predecessor Sergei Ignatyev.
Key interest rates have now been on hold for 10 months. In its policy statement the central bank said that "risks of economic slowdown remain given the weak investment activity and the sluggish recovery in external demand".
It also said that inflation, running at 6.6 percent as of July 8, would fall within the bank's 5-6 percent target range in the second half of the year. The bank removed a phrase seen in previous statements that had warned about risks to inflation expectations from persistent inflation above this range.
It announced the launch of auctions for loans secured against non-market assets and guarantees, for 12 months with a floating rate initially set at the level of 5.75 percent.
Widening the range of collateral against which banks can raise funding is designed to improve the transmission of monetary policy and ensure that affordable credit can flow into the economy, without necessarily cutting short-term rates.
Other central banks, such as the European Central Bank, have also moved to provide longer-term financing.
Russia's economy is growing at its slowest pace in four years and President Vladimir Putin has instructed government and central bank officials to come up with ways to ensure the flow of more affordable credit to the economy.
The central bank kept the one-day auction repo rate unchanged at 5.5 percent, while the fixed one-day repo rate stays at 6.5 percent and the overnight deposit rate at 4.5 percent.
The refinancing rate, the largely symbolic cost of overnight loans from the central bank, was held at 8.25 percent.
The rouble firmed briefly after the statement but then erased its gains to trade down 0.2 percent versus dollar-euro basket at 1000 GMT.
(Reporting by Maya Dyakina; Editing by Douglas Busvine and Susan Fenton)