“Inflation will accelerate”: July economic results in numbers

Officials released consumer price indexes for July. According to Rosstat, the results of the second summer month are not encouraging: the average cost of an ordinary domestic inhabitant to purchase a basic shopping basket of goods increased by 4.3% in annual terms (in June, the growth in expenses year-on-year was 3.25%). It is clear that inflation is accelerating. However, at the household level and with the naked eye, such shifts are difficult to catch. For Russians, inflation is simply there and there is no getting away from it. We encounter it every day when going to the grocery store. And how much: one percent more or less – what’s the difference? Still want to eat…

July’s 4.3%, as noted by the statistical office, is the highest level since February, when annual inflation went off scale for 10%. Inflation is gradually accelerating. During the first week of August, prices for all groups of goods (food, industrial and services) added another 0.01%, and on an annualized basis they reached 4.43% – again growth and acceleration.

Let’s walk along the trading counter. Onions: 39 rubles per kilogram, cabbage: 40 re, tomatoes from 80 to 240 rubles, apples of the Gala variety – 300 rubles, a dozen chicken eggs from 60 to 119 …

In the middle month of summer, the price of fruits and vegetables unexpectedly rose by almost 13% compared to the same period last year. After all, in the summer of 2022 in Russia, for the first time in history, deflation was recorded, and for all three months in a row. In July, fruits and vegetables then fell in price by 11.5%, and now they have added 1.77% in price. Note that in June 2023, the price reduction for these products was 2.35%. However, July did not pick up this trend and did not continue.

Oranges stand out here. In relation to June, they have risen in price by almost 23%. Another 12.5 percent added white cabbage. Apples, lemons and pears barely kept up with it: their prices rose by 9.5%, 7.9% and 3.3% respectively. Even potatoes made their contribution, the harvesting of which last month in Russia was already in full swing. But by some miracle, by June, it has risen in price by 0.7%. Probably, such a picture can be regarded as a miracle today. In retail chains, next to young Russian potatoes for 21 rubles, young Azerbaijani potatoes are sold for … 59 rubles a kilogram. Guess three times what the buyer chooses. However, most likely, the more expensive “poteytos” can be called “young” with a big stretch: how many months it was transported, how many it was cleared through customs.

Among other food products for every day, in July, compared to June, the price of granulated sugar rose by 4.38%. chicken legs (2.4%), pork (2%), chicken eggs (1.62%),

But there is also good news: onion fell in price by 17.4%, followed by cucumbers – by almost the same amount, carrots – by 4.7%. Tomatoes dropped 0.3% in price. The prices for vegetable oil and buckwheat groats also decreased – by about 1.4% each of the products. In general, inflation for a single group of food products in July amounted to 2.23% in annual terms and 0.49% in its monthly “step”.

– Last year’s summer deflation was small, – says financial analyst, candidate of economic sciences Mikhail Belyaev. – In addition, for individual goods. In the spring of 2022, trade raised prices so much that already in the summer, in order to ensure the population’s accessibility to shopping, they had to be reduced against the backdrop of a seasonal factor. Here is the secret of that deflation. It can most likely be called a correction of the “fat” spring trade appetites, it does not indicate the underlying causes of economic growth. Now the prices “from summer to summer” grew evenly.

– And we should not wait for deflation?

– What are you talking about at the current exchange rate of the ruble? On the contrary, it dictates an increase in inflation. All imported goods are seriously becoming more expensive, the ruble is falling, and prices are rising. Inflation will accelerate further. It is already rumored that the key rate will be raised to 9.5%. If it reaches a double-digit value, our economy in general may come to a “kayuk”.

– What do you think inflation will be at the end of the year?

– I can’t say with accuracy up to a percentage. I believe that it will not go beyond 10% But, given today’s realities in the economy, it will at least catch up to 8%. Due to the current monetary policy of the Central Bank, nothing else can be expected.

– What is your forecast for the ruble exchange rate?

– Our national currency is now doomed to decline against the dollar. The ruble, of course, will not fly into space. The economy continues to work, although not as efficiently as we would like. However, 100 rubles per dollar can be safely predicted. And if nothing changes further, then by mid-September the “American” will grow up to 110 rubles.