As of 7 December the annual rate of increase in consumer prices amounted to 14.8% after 15.6% in October. The annual rate of increase in consumer prices will amount to about 6% at the end of 2016 and to reach the target level of 4% in 2017.
MOSCOW, 11 Dec. Annual inflation in Russia slowed to 7 December to 14.8% after 15.6% in October, and at the end of 2016 will be about 6% and will reach the target level of 4% in 2017, according to a press release on the results of the Board of Directors of the Central Bank.
The Bank of Russia on Friday kept its benchmark rate at 11% per annum due to the increasing inflation risks.
“In November — early December 2015, the decline in inflation continued. According to the Bank of Russia, as of 7 December the annual rate of increase in consumer prices amounted to 14.8% after 15.6% in October. With the exception of seasonality month inflation fell from 0.9% in August-October down to 0.7% in November. Slower growth in consumer prices was promoted by a favorable conjuncture of the agrarian market, the gradual exhaustion of the impact on prices occurred in July-August ruble depreciation and weak consumer demand, low growth of nominal incomes of the population”, — said the regulator.
“Slower growth in consumer prices was somewhat slower than expected. In addition, inflation expectations of the population in November increased, although they were to be reduced,” added the regulator.
In early 2016, according to Central Bank estimates that annual inflation was “significantly reduced”, which will be due to the high value of this indicator in the beginning of 2015. The decrease in annual inflation in 2016-2017 will contribute to weak consumer demand and a moderately tight monetary conditions. Slower growth of consumer prices will create conditions to lower inflation expectations. According to the forecast of Bank of Russia, the annual rate of increase in consumer prices will amount to about 6% at the end of 2016 and to reach the target level of 4% in 2017, boosted by monetary and credit policy.
“Introduction from January 2016 trade restrictions against Turkey will not have a significant impact on the dynamics of consumer prices. Until the end of 2015 — early 2016 is a possible increase in inflation from these restrictions is estimated at between 0.2 and 0.4 percentage points,” said the regulator.