Russia's central bank has cut a key interest rate, which it had hiked in previous months to support the rouble, in order to help the economy.

The rouble dropped 1.6 per cent to 69.8 roubles against the dollar following the announcement.

Higher rates can help a currency, but also hurt economic growth by making loans more expensive.

The bank raised the rate to 17 per cent late last year in a last-ditch attempt to curb the devaluation of the rouble - which has lost more than half of its value.

The bank on Friday cut it back down to 15 per cent, saying it views the risks of an economic slowdown are now higher than fears of a spiralling inflation.

Russia's economy has been battered by lower energy prices and Western sanctions.

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