The Russian producer price index rose 10.9% y/y in March

The Russian producer price index rose 10.9% y/y in March
Russian producer price inflation (PPI) rose March 2019 to 10.9% while consumer price inflation was also up to 5.3%
By bne IntelliNews April 16, 2019

The Russian producer price index rose 0.9% on the month and 10.9% on the year in March after a 0.1% month-on-month increase in February, the Federal State Statistics Service said in a statement on April 16.

In March, prices in the mining sector grew 8.2%, while in the processing industry they fell 0.4%. In January-March, the prices fell 1.1% since the start of the year.

In 2018, prices of industrial producers rose 11.7%, the service said earlier.

Consumer price inflation (CPI) has also ticked up slightly this year and was 5.3% in March, ahead of the Central Bank of Russia (CBR) target level of 4%.

However, the inflationary effect of an increase in VAT rates appears to have been milder than anticipated and inflation is expected to moderate in the second half of this year before falling back to the CBR’s target rate of 4% next year.

Despite the lower than expected inflation rate analysts do not expect the CBR to cut rates at the monetary policy meeting later this month, although there is some hope that the CBR might make a growth-boosting cut to rates in the third quarter according to some analysts.