Russia Inflation April 2016


Russia: Inflation stabilizes in April at two-year low

May 6, 2016

Consumer prices rose 0.4% in April over the previous month, which was down from a 0.5% increase in March. The reading marked a third consecutive moderation and the slowest monthly increase in eight months. Moreover, April’s result undershot the 0.6% increase the markets had expected. According to the statistical office, the moderation in April reflected mainly a slower increase in prices for food products and energy.

In April, inflation stabilized at March’s 7.3% and remained at the lowest level since April 2014. Inflation began to decline in free fall in August 2015 from a peak of 15.8% and rapid fall in inflation was mainly the result of a favorable base effect, which appears to have faded in April. Moreover, the recent stabilization of the Russian ruble has helped to diminish inflationary pressures. That said, inflation remains well above the Central Bank’s target of 4.0%.

The Central Bank recently stated that inflation remains at risk of stalling at between 6.0% and 7.0% in the remainder of the year. However, Russian monetary authorities are confident that inflation will be on track to reach the 4.0% target at the end of 2017. The Consensus view of a panel of analysts surveyed by FocusEconomics is not in line with the Central Bank’s assessment. Panelists see inflation ending 2016 at 7.4%, which is unchanged from last month’s forecast. For 2017, participants expect inflation to ease to 6.0% .

Author:, Senior Economist

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Russia Inflation Chart

Russia Inflation April 2016 0

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

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