Russia’s inflation rate to reach 5.5% in the beginning of the year

According to the Russian Central Bank, the inflation rate might reach 5.5% in the beginning of 2019 due to the VAT increase.

Russians are no longer waiting for a decrease in the inflation rate. The Central Bank says that their expectations are quite realistic. The inflation rate will reach 5.5% and its growth will begin to slow down only within a year. In the first half of 2020, it can drop to 4%. The Ministry of Economic Development is more optimistic. According to them, the inflation rate will be 4.3% in the end of 2019. The Central Bank does not agree with this forecast. Its experts are confident that the inflation rate in the end of the year will be the same as in the beginning: some 5%-5.5%, Interfax news agency reports. According to Central Bank analysts, the inflation rate in the end of 2018 will be 4.2%-4.3%.

The main causes for high inflation rates in January 2019 will be the planned VAT increase and the indexation of regulated tariffs.

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