Russia’s central bank has raised its key interest rate by a full percentage point to 19% to combat high inflation as government spending on the military strains the economy’s capacity to produce goods and services and drives up workers’ wages.

Russia's central bank unexpectedly raised its benchmark interest rate by 100 basis points to 19% on Friday, saying that inflation remained stubbornly high and action was needed to reduce it.

Russia’s central bank raised its key interest rate for the second straight meeting of its policymakers in an effort to tame a pickup in inflation driven by the diversion of manpower and other resources to sustain the country’s conflict with Ukraine.

Officials in some countries started cutting rates last year, but others, including those in Europe and the United States, have taken a more cautious approach.

Russia's central bank has sent a stark warning to subsidiaries of Western banks remaining in Russia not to discriminate against their Russian clients by denying them services such as transferring money abroad,

Russia's central bank on Friday raised interest rates to 19 percent amid the country's ongoing Ukraine offensive, warning inflation was running too high and it needed to cool the economy.