The Central Bank allowed the strengthening of the influence of the budget factor on inflation

The influence of the budgetary factor on inflation in Russia may increase in the short term, while medium-term risks are contained due to the fiscal rule. This was stated by the First Deputy Chairman of the Central Bank Ksenia Yudaeva at the All-Russian Banking Conference organized by the Association of Banks of Russia.

“The contribution of the budget to inflation in the short term may also increase, we are aware of this… As long as the fiscal rule is in place, medium-term fiscal risks are contained by this,” – leads her words “Interfax”.

Yudaeva also noted that increased budget expenditures have not yet had a significant impact on demand, since not all of them have been brought to the final recipients. Now consumption is recovering, she added.

May 22 Ministry of Finance of the Russian Federation clarified estimate of the federal budget deficit in the first quarter of 2023 – it was executed with a deficit of 2.086 trillion rubles. Earlier, Vedomosti wrote that federal budget revenues amounted to 5.7 trillion rubles. according to the results of January – March 2023, which is 21% lower than the first quarter of 2022. The decrease is due to a decrease in income from energy exports, the Ministry of Finance explained then.

According to the current budget law, revenues for 2023 are planned in the amount of 26.1 trillion rubles, expenses – 29 trillion, thus, the deficit is expected at the level of 2.9 trillion, or 2% of GDP.

On May 24, the Central Bank announced that inflation expectations of the population grew up in May by 0.4% after a decrease in the previous two months and amounted to 10.8%. The regulator recalled that it expects an increase in annual inflation in the Russian Federation from May due to the withdrawal from its calculation of low values ​​​​of an increase in this indicator in the summer-autumn of 2022.

At the end of April, the regulator improved its forecast for inflation and the rate of recovery of the Russian economy in 2023. The regulator now expects GDP growth of 0.5-2%, although back in February it predicted a decline. According to the Central Bank, inflation in 2023 will be 4.5-6.5%, in February it was expected at the level of 5-7%. According to the regulator’s forecast, in the second quarter inflation will be at the level of 3.6%, and by the end of the year it may reach 4.5-6.5%. In 2024, inflation will reach a plateau.