* Refi rate cut to 7.75 percent from 8 percent from June 1
* Move was expected by half the analysts polled
* Pause seen for summer months
(adds details, analyst comment)
By Yelena Fabrichnaya and Toni Vorobyova
MOSCOW, May 31 (Reuters) - Russia's central bank cut interest rates on Monday for the 14th time in a year-long easing cycle and signalled a pause, saying policy should now be at a level where loans are affordable and inflation is contained.
A Reuters poll last week gave even chances of a rate cut or of unchanged policy in May, making this month's decision the most finely balanced one in the current cycle. [ID:nLDE64R15B
The benchmark refinancing rate will be reduced by 25 basis points to a new historic low of 7.75 percent effective from Tuesday, taking the cumulative easing since April 2009 to 525 basis points.
"The parameters set ... create the conditions for the formation of money market rates which will enable an acceptable balance between the affordability of borrowing funds and inflation risks," the central bank said in a statement.
"Consequently, the Bank of Russia thinks it likely that the achieved level of interest rates will be maintained in the coming months."
April economic data pointed to signs of a sturdier recovery from recession, while banks' lending activity has finally picked up, and rouble appreciation -- seen as another reason for past central bank rate cuts -- ran out of steam.
All were seen as reasons for rates being on hold this month, while still-benign inflation levels supported the argument that there was still room left for a bit more monetary easing.
Deputy Economy Minister Andrei Klepach on Monday forecast May inflation at 0.2-0.3 percent on the month.
"It looks like the central bank focused to a greater extent on ... inflation, which is quite favourable," said Yaroslav Lissovolik, chief strategist at Deutsche Bank in Moscow.
"The fact that there is such instability on financial markets may have eased the central bank's decision, which stimulates the economy even more and compensates for the negative impact of global markets."
The Russian stock market and the rouble have come under pressure along with oil prices in recent weeks.
The central bank said it was not concerned by the level of rouble volatility and that the new level of rates should not create significant reasons for capital inflows.
Nikolai Podguzov, fixed income analyst at Renaissance Capital, said "a weaker rouble is more of a boon for the Russian economy" which will enable the central bank to take a breather.
"The central bank gave a pretty clear signal that at least for 2-3 months, for the summer period, they are taking a pause in cuts," he said, adding that hikes this year are unlikely, while another cut is possible if inflation remains tame.
Prime Minister Vladimir Putin, who has touted the fall in inflation to its lowest in Russia's post-Soviet Union history as a key success, on Monday called on private companies to help the government to keep prices in check.
The central bank statement came after the close of rouble trade on Russia's MICEX exchange. News of the cut could add pressure on the rouble, but markets will likely take heart from the chances that policy will now remain on hold for a while at levels which still leave yields attractive compared to many developed and emerging economies.
For the first time in recent months, the rate move was not uniform, with overnight deposit rates -- a key barometer for interbank rates -- left on hold at 2.50 percent.
The central bank also issued a separate statement revising the fixed Lombard rates set for June 1 operations, which had earlier been announced at unchanged levels. (Additional reporting by Gleb Bryanski and Andrey Ostroukh; Writing by Toni Vorobyova; editing by Mike Peacock, Ron Askew)