The MAYOR: inflation in Crimea in 2015 reached 26.4% and was the highest among the regions of the Russian Federation

The MAYOR: inflation in Crimea in 2015 reached 26.4% and was the highest among the regions of the Russian Federation

MOSCOW, February 10. The highest among the regions of the Russian Federation, inflation in 2015 was observed in the Crimea, where she was 26,4% in comparison to 12.9% in Russia as a whole. Such estimation contains in the monitoring of the Ministry of economic development last year.

Thus in the regions the growth in prices for the year ranged from 10.3% to 17.5%. With the exception of the Crimean Federal district, inflation in Russia last year amounted to 12,7%.

Inflation also exceeded the 14.8% in the four regions of the North Caucasus Federal district (the Republic of Ingushetia of 17.5%; Kabardino-Balkaria – 15,3%, etc.) where there was a specific condition of economic development, says the MAYOR.

Features of problem regions has further contributed to annual inflation by 1 percentage point.

The devaluation of the ruble and inflation

According to the MAYOR, the contribution of the ruble devaluation to inflation in 2015 amounted to 8 percentage points when headline inflation for the year at 12.9%.

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“The main contribution to inflation was made by the devaluation of the ruble, which began in late 2014. According to the Ministry of economic development, the contribution of devaluation to inflation has averaged for the year about 8 percentage points”, – reports the Agency.

As also noted by the MAYOR, the immediate impact on inflation has continued to provide and taken counter-sanctions to restrict imports of food, but by the end of 2015, their impact became negligible.

According to the forecast of the RF Central Bank, inflation in 2016 will be 5.5-6.5 per cent.

The decline in GDP stopped

According to the Ministry of economic development, the GDP of the Russian Federation with seasonality in December 2015 stopped, reaching 0% compared with a decline of 0.2% in November.

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“Preliminary data for December showed almost stopping the decline in economic activity (after a slight dip in November of the current year). According to the Ministry of economic development, the GDP index with the exception of seasonality amounted to 0.0% (estimation associated with the publication by Rosstat data on the volume of wholesale trade) to the previous month, against 0.2 in November,” according to the document.

In annual terms the GDP decline in December was 3.5%.

As previously stated the Minister of economic development Alexei Ulyukayev, the Russian economy has technically emerged from recession, if the recession is to understand the decline in the past two quarters.

According to the data contained in the Bulletin of the Department of studies and forecasting of the Bank of Russia, the Russian economy in the coming months, most likely, will continue to “feel the bottom”.

The situation on the steel market

In outcome monitoring, the MAYOR notes that the domestic steel market remains unfavourable situation, which is largely due to how long the decline in domestic demand for products of domestic manufacturers, thus remaining at low price levels.

The iron and steel sector in the first half of 2015 showed a good positive trend due to significant export volumes. However, recently the situation in the context of continuing drop in world prices for steel and other iron ore products has changed, the report says.

The main reason for the decrease in production volume of steel products in 2015 is the deterioration of the market situation in key markets.

“Partly negative situation in the steel sector in December and for the year for the production of prefabricated structures of steel and rolled ferrous metals is explained by the negative dynamics in construction, as well as a significant reduction in the production and consumption of cars. Another negative factor is the continued high volume of import of rolled steel by Ukrainian producers,” said the MAYOR.