Inflation expectations in Russia for a year ahead stabilized

Moscow. December 30. Inflationary expectations of the population of the Russian Federation for the month ahead worsened, however, the year ahead is stabilized, according to a survey carried out by LLC “infom” by the order of the Bank of Russia. The survey was conducted among 2 thousand people in 105 locations in 55 subjects of the Russian Federation from 10 to 13 December 2015. The statistical error does not exceed 3.3 per cent.

“Qualitative assessment of inflation expectations for the next 12 months has stabilized. The proportion of respondents who next year expect faster growth of prices (by 19%), no change. The popularity of the answer is that inflation will slow, increasing slightly at the expense of reducing the share awaiting her on the same level”, – stated in the review, published on the website of the regulator. Save price growth next year at the current level expects 50% of respondents.

Worsened inflation expectations for the month ahead, but experts note that this effect is traditional for December. The proportion of respondents expecting in the next month very strong price growth reached 30% (against 25% in the previous month and 20% two months earlier), which corresponds to the average value of the previous polls, held in December. The total share of waiting next month of rising prices in General has not changed.

In December of 2015 the median value of expected inflation for the year increased (by 0.6 p. p.) and amounted to 16.4%. This is the maximum value after the surge of inflationary expectations in January-February.

Assessment for the observed year inflation increased slightly – by 1.1 percentage points, to 23.3%, after two months of decline, but is still at the level observed in July-August this year. The share of respondents who consider that over the past year prices have grown by more than 50%, decreasing for the third month in a row – now there 12,4% of respondents.

In December, the respondents more often began to note the rise in the cost of fruits and vegetables, eggs, milk and dairy products. Prices on all these products is really growing in high pace in late November and early December.

The median estimate of expected annual inflation and the percentage of citizens who expected that inflation in three years will exceed the target level the Bank of Russia with 4% per annum, increased slightly. About 71% of respondents believe that inflation at the end of 2017 will be significantly higher than stated by the Bank of Russia target 4% a year.

Income dynamics on the background of rising prices over the past year and expectations for next year continues to be negatively assessed by Russians: the majority of respondents say that income does not have time and will not keep pace with rising prices, and last month the frequency of such responses has only increased. About 71% of the respondents reported that their income did not grow, and prices rose (in the previous month – 66%), another 21% reported that revenues grew slower than prices (previous month – 25%). That income will not grow, and prices will rise next year, expect 62% (a month earlier – 58%).

Significantly increased the share of citizens who resort to “restrictive” strategy of behavior in conditions of inflation, such as purchasing cheaper products and goods, refusal of certain foods, goods, services, entertainment. Also, he became referred to this strategy as buying products in store.