Russia: Inflation falls to over one-year low in August
Latest reading: Inflation eased to 8.1% in August from July’s 8.8%, marking the lowest inflation rate since April 2024, and the fifth consecutive month of deceleration. The downtrend was likely underpinned by record-high interest rates. Even so, inflation is still running at over double the Central Bank’s 4.0% target.
Looking at the details of the release, the deceleration was broad-based, with price pressures easing across food, non-food goods and services.
The trend was unchanged, with annual average inflation coming in at July’s 9.4% in August. Meanwhile, core inflation fell to 8.0% in August from July’s 8.5%.
Lastly, consumer prices dropped 0.40% in August over the previous month, swinging from the 0.57% rise logged in July. August’s result marked the weakest reading since August 2022.
Panelist insight: Commenting on the outlook, analysts at EIU stated:
“We expect inflation to remain high in 2025 […] well above the CBR’s target rate of 4%. Although core inflation has shown some signs of slowing, underlying measures of price growth remain elevated. Despite still-tight monetary policy, inflation expectations remain high, the labour market remains tight and war spending remains substantial, which continues to fuel inflation. International sanctions and a weaker harvest also create price pressures.”