Annual inflation in Russia accelerated to 6.59%

Weekly inflation in Russia from October 17 to October 23 accelerated to 0.24% after 0.15% a week earlier, follows from data Rosstat. In annual terms, price growth accelerated to 6.59% from 6.38% in the previous week, the Ministry of Energy clarifies in its review about the current price situation.

Since the beginning of October, prices have increased by 0.69%, and since the beginning of the year – by 5.32%.

In the food products segment, prices increased by 0.39%. In particular, fruits and vegetables increased in price by 1.15% after 0.35% a week earlier. Tomatoes increased in price by 7.3%, cucumbers by 3.7%, bananas by 1.0%, and beets by 0.3%.

“The decline in prices for borscht vegetables did not compensate for the accelerated rise in prices for cucumbers and tomatoes. For other food products, the rate of price growth has decreased,” notes the Ministry of Economy. Chicken eggs increased in price by 2.5%, rice – by 0.9%, chicken and boiled sausage – by 0.7%.

In the segment of non-food products, price dynamics remained practically at the same level (0.05% after 0.06% a week earlier). Electric vacuum cleaners rose in price by 1%, and televisions, T-shirts and T-shirts for men – by 0.6%. Gasoline prices decreased by 0.2%, and diesel prices by 0.3%.

In the segment of regulated, tourist and personal services, prices increased again (+0.42%) after a slight deflation (-0.06%) a week earlier. Domestic flights became more expensive by 7.28%, and accommodation in hostels, hotels and boarding houses became cheaper by 0.1% – 0.7%, depending on the type of object.

On October 24, the Bank of Russia reported a decrease in inflation expectations of Russians in October after growth over the previous three months. Their median estimate for the year ahead was 11.2%, as follows from the results of a survey by inFOM LLC. At the same time, observed inflation has increased for the third month in a row. The figure increased in September from 13.8 to 13.9%.

In September, the Bank of Russia predicted that annual inflation would continue to rise in the coming months due to increasing price pressure. In 2023, annual inflation will be 6-7%. It will return to 4% in 2024 and will remain at this level in the future. Annual inflation in Russia will reach its peak in the spring and summer, the regulator expects.

On September 15, the Central Bank raised the key rate by 1 percentage point to 13%. This is the third consecutive rate increase in a month and a half: first, the Central Bank raised the rate at a meeting on July 21 by 1 percentage point to 8.5%, and then unscheduledly increased the rate on August 15 immediately to 12%. In September, consumer prices rose 6% year on year after 5.15% in August. In monthly terms, inflation also accelerated, amounting to 0.87% compared to 0.28% a month earlier. Compared to December 2022, the increase was 4.6%.

The next meeting of the Board of Directors of the Central Bank on the key rate will be held on Friday, October 27.