The joint venture of Russia sees no risks of exceeding in 2016 the inflation forecast at 6.4%

The joint venture of Russia sees no risks of exceeding in 2016 the inflation forecast at 6.4%


The assumption about the reduction in one-year inflation rate almost doubled requires no additional justification, said the head of the accounting chamber Tatyana Golikova.

MOSCOW, 27 Jan. The accounts chamber of the Russian Federation sees no risks of exceeding the official forecast on inflation in Russia in 2016, amounting to 6.4 percent, said the head of the Ministry Tatyana Golikova, speaking at the parliamentary hearings in the Federation Council.

“Taking into account the reduction in aggregate demand in the economy as a result of the reduction of real incomes of the population, relatively tight monetary policy, forecast a moderate decline (growth — ed.) of tariffs for services of natural monopolies, we also expect a slowdown in inflation. However, the assumption about the reduction in one-year inflation rate almost doubled, it seems to us, requires further justification,” he said.

As per the baseline scenario of the forecast the macroeconomic forecast of the Ministry of economic development, which formed the basis of the calculation of the parameters of the budget for 2016, the growth rate of consumer prices year will decrease from 12.2% this year to 6.4% next year.

The head of audit chamber has indicated on a number of factors, which prevents the reduction of inflation. According to her, this low level of competition in the domestic market of investment and consumer products, entrenched Pro-inflationary sentiment, high interest rates and the lack of a systematic and balanced approach to promoting long-term savings.

In favor of exceeding the forecast plays, according to Golikova, and the current structure of mandatory payments to the budget, when more than half of its revenue from indirect income, such as VAT, customs duties, excise duties, and the aging of production assets, which limits the ability of enterprises to reduce costs.

Thus the audit chamber expects the decline in personal income, which is observed this year, will restrain the growth in consumer demand in Russia, which, according to Golikova, in recent years, was one of the key factors in maintaining economic growth.