Inflation in Russia jumps to 11.4% in December

By bne IntelliNews January 5, 2015

Consumer price growth in December accelerated to reach double-digit values, hitting 11.4% y/y and 2.6% m/m vs. 9.1% y/y and 1.3% m/m seen in November, according to preliminary data by RosStat. The acceleration in price growth in December was faster than anticipated, as headline inflation was expected to approach 10% in Q1/15 by both officials and analysts. RosStat is going to provide full data on January 12.

While previously inflation was expected to moderate in July, Russia's food embargo and a spin in geopolitical tension seen in August-September, have worsened the outlook on price growth. Inflationary expectations spiked in October-December as the ruble tracked global oil prices, sinking by 30%-40%.

In December, according to preliminary data, food prices continued growing, increasing by 15.4% y/y and 3.3% m/m. The pace of price growth in the service sector also accelerated notably to 10.5% y/y and 2.2% m/m.

While the Central Bank of Russia’s mid-term inflation target is 4%-5%, the forecast for 2014 has been revised upwards from 6% to over 7%, to over 8.5%. Most recently the CBR officials admitted that annual inflation is going to approach 10% in the end of 2014 and beginning of 2015.

CPI inflation, y/y

Dec-08

Dec-09

Dec-10

Dec-11

Dec-12

Dec-13

Jan-14

Dec-14

TOTAL

13.3%

8.8%

8.8%

6.1%

6.6%

6.5%

6.1%

11.4%

Food

16.5%

6.1%

12.9%

3.9%

7.5%

7.3%

6.5%

15.4%

Non-food

8.0%

9.7%

5.0%

6.7%

5.2%

4.5%

6.5%

8.1%

Services

15.9%

11.6%

8.1%

8.7%

7.3%

8.0%

7.8%

10.5%

Source: RosStat

 

 

 

 

 

 

 

 

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