Russia’s y-o-y inflation slows amid w-o-w deflation

RUSSIA ECONOMICS - In Brief 15 Jun 2022 by Alexander Kudrin
Rosstat reported that deflation of 0.14% was registered in seven days ending on June 10. The MTD consumer prices fell by the same 0.14%, and the YTD inflation decreased to 11.64%. As in inflation in June 2021 was 0.69% m-o-m a further y-o-y disinflation is expended this month. Consumer prices are falling across the board. Deflation m-o-m in June (if it happens) would be a rare case as the harvesting season starts in the second half of July and may continue until October. One cannot rule out deflation in summer as a whole. If deflation will be steady this summer, then one cannot rule out more action from the CBR in July and the key rate may be cut again. In some sense, Russia is decoupling from the developed countries as the ruble strengthens amid the rising Fed’s rate (while Russian CBR keeps cutting its key rate). A stronger ruble helps to contain inflation m-o-m. Evgeny Gavrilenkov Alexander Kudrin

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