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>>colone+(OP)
When a currency is devaluating but interest rates are low, the banks can borrow at low rate, sell rubles for dollars into sliding market, wait for ruble to slide more, then repay the loan with cheaper rubles and make a big profit. The trouble is they also accelerate the slide, courtesy of the low rates. The central bank rate increase was likely done to head off that particular danger. Of course there are many other factors pressing the ruble down as well, which central bank can't control, but at least they are trying to prevent worseing the situation with their own hands.

Long term high interest rates plus high cost of import supplies will likely strangle the economy though. Increased demand for domestic goods due to higher import prices is a good thing, but one needs capital to operate most businesses. When interest rates are high you can't borrow, and when political situation is flaky fewer people will want to buy equity.

>>DenisM+ab
Well in the Bloomberg video (new link) the analyst says that projected "growth" for the Russian economy next year is -4% (so, not growth, but a contraction of 4%).

At 14% interest rates there's basically no way to afford capital investments. Unless you are buying a printing press to print more money.