The annual inflation in Russia will exceed the Central Bank’s target in the next quarter, according to the regulatory body’s forecast. “The answer is short: it will happen as soon as the third quarter,” Kirill Tremasov, Director of the Department of Monetary Policy at the Central Bank of Russia, said at a news conference in Novosibirsk when asked whether the annual inflation rate will grow beyond 4%.
The latest data released by the Federal Statistics Service, covering 26 days in June, indicates that the annual inflation rate was 3.2% to date. The Central Bank predicted that in 2023, the inflation rate will reach 4.5-6.5% per annum while, according to the prognosis of the Ministry for Economic Development, it will be around 5.3%. Inflation will not go down to the target of 4% before 2024, the head of the analytical department at AMarkets Artem Deev notes.
“The low inflation rate we have seen recently may have been caused by a weak ruble earlier this year. Prices grew faster. However, this effect has been essentially exhausted by now,” the expert explains. “There were also temporary factors such as high commodity export revenues and the excessive revenues of the previous year. Certainly, Russians’ strong inclination to save money has played a role. We should not forget about the measures taken by the Central Bank either.”