The population is waiting for a rise in prices and is ready to consume – Kommersant

In May 2023, the median inflation expected by the population in a year, according to FOM estimates for the Central Bank, rose to 10.8% from 10.4% in April. An increase in the indicator was recorded only among respondents without savings, while the expectations of the subgroup of respondents with savings did not change (see chart). The annual inflation observed by respondents now fell to 14.1% in May (by 0.8 percentage points compared to April), which is the lowest since March 2021. Respondents’ concerns about rising prices for most goods also eased in May. The share of respondents who reported a strong increase in prices for housing and communal services (due to the traditional end of the heating season), medicines, tea, coffee and eggs decreased the most. Survey participants also reported strong increases in prices for cheeses and sausages more often than in April; clothes, shoes and leather goods.

Against this background, the price expectations of enterprises as a whole decreased (as did the estimates of expected demand), but in retail trade they continued to grow, despite more restrained expectations regarding demand from retailers, the Central Bank notes. The latter is confirmed by the latest estimates of weekly inflation published by Rosstat. In the week from May 16 to May 22, 2023, prices increased by 0.04%. The average daily price growth slowed to 0.006% from 0.008% a week earlier. However, without volatile components (vegetables and air travel), according to analysts from the MMI Telegram channel, it amounted to 0.14% against 0.10% and 0.08% two weeks earlier – that is, inflation, cleared of volatile components, continues to accelerate . Qualitative assessments of expected inflation for the year and month ahead in May, as noted by the Central Bank, also slightly increased – a larger proportion of respondents than last month indicated that prices would rise faster than now, or grow very strongly.

The consumer sentiment index, measured by the Central Bank, slightly decreased in May (by 2.2 points compared to April) after six months of growth and returned to the level of March 2023, remaining close to the highs since the first half of 2018. The decline was due to worsening expectations of the economic situation in the country and the personal financial situation of the respondents. Estimates of the current state are almost stable in both of its components: the actual change in financial position over the year and the favorableness of the current moment for large purchases.

Artem Chugunov