Inflation slows and may decelerate faster than expected

RUSSIA ECONOMICS - In Brief 14 Apr 2021 by Alexander Kudrin
Rosstat reported that inflation was at 0.1% over the seven days ending on April 12. From April 1 to April 12, it also remained at 0.1%. There are more signs of gradually declining prices across a growing number of products of the consumption basket. These observations generally support GKEM Analytica’s view that an acceleration of inflation in 4Q20 and 1Q21 was fueled by the enormous federal budget spending spree in November-December so that disinflation looked natural in 2Q20. A very uneven allocation of budgetary funds last year unsurprisingly appeared inflationary. It didn’t help much to support growth, as, in the most uneasy period in 2Q20, the economy saw limited budgetary spending. As this spending moderated this year, inflation gradually came back to more traditional levels. It won’t be surprising if the m-o-m inflation in April could stay around 0.3% or only slightly higher. If so, then inflation y-o-y will fall in April to 5.3-5.4% from 5.8% in March. Hopefully, it may cool down the CBR’s hawkish mood and encourage the regulator to stay on hold in April and reverse its intentions to hike the key rate going as was mentioned in the minutes of the latest Board of Directors meeting.Evgeny GavrilenkovAlexander Kudrin

Now read on...

Register to sample a report

Register
Sign-in
Forgot your password?
Copyright 2024 GlobalSource Partners. All rights reserved. This is prepared for GlobalSource Partners’ clients and may not be redistributed, reproduced, stored in a retrieval system, retransmitted or disclosed, in whole or in part, or in any form or manner, without the express written consent of GlobalSource Partners. This is distributed simultaneously to our website and other portals used by GlobalSource Partners. The information herein was obtained from various sources and is believed to be reliable but GlobalSource Partners does not warrant its completeness or accuracy. Neither GlobalSource Partners nor any Country Analyst, officer or employee accepts any liability whatsoever for any direct, indirect or consequential damages or losses rising from any use of this or its contents.