Russia Inflation March 2021


Russia: Inflation hits highest level since November 2016 in March

April 7, 2021

Consumer prices rose 0.66% in March over the previous month, a smaller increase than February's 0.78% rise. March's result marked the softest rise in prices since October 2020. Inflation came in at 5.8% in March, up from February’s 5.7%. March's result was the highest inflation rate since November 2016. Meanwhile, the trend pointed up, with annual average inflation coming in at 4.2% in March (February: 3.9%). Core inflation rose to 5.4% from the previous month's 5.0%.

Commenting on the outlook, Dmitry Dolgin, chief Russia economist at ING, said:

“Even though Russian inflation has probably peaked in March and is likely to decelerate to 5.5% YoY in April, we expect it to remain above 5% until November, and see upward risks to our year-end 4.2% target. The risk factors include elevated ruble volatility, delayed effects of administrative price controls in socially-sensitive items, secondary effects of gasoline price growth, and potential increase in the budget spending plan this year ahead of the September Parliamentary elections. We believe that at the upcoming central bank meeting on 23 April, which will take place after the Presidential Address on 21 April, will remain focused on the pro-inflationary risks and will be deciding between a 25bp and 50bp key rate hike.”

FocusEconomics panelists see inflation ending 2021 at 3.6%, which is up 0.1 percentage points from last month’s forecast. For 2022, participants project inflation to end the year at 3.7%.


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Russia Inflation Chart

Russia Inflation March 2021

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: Federal State Statistics Service (Rosstat)

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