Russian weekly consumer price index rises for the first time since May

By Garima Soni  | Date: September 29, 2022

Russian weekly consumer price index rises for the first time since May

A recently released data has revealed that weekly consumer prices in Russia increased for the first time since May, which was less than two weeks after the central bank hinted at putting an end to its monetary easing cycle and decreasing retail prices.

For those unaware, the consumer price index in Russia increased by 0.08% in the week ending September 26 after falling for 11 weeks in a row. According to the economy ministry, annual inflation decreased from 13.92% a week earlier to 13.71% as of September 26.

Meanwhile, the central bank lowered its benchmark interest rate to 7.5% earlier this month, but it implied that the rate-cutting campaign would soon come to a stop by leaving out a directive to consider whether additional rate cuts might be necessary as inflation expectations grow.

The inflation spiked after Moscow began its special military operation in Ukraine earlier this year, causing the central bank to raise rates to 20% in February in an effort to slow the speed of price increases.

However, recent declines in living standards have negatively impacted consumer demand, hurting retail sales and resulting in a prolonged period of deflation over the summer.

Russian households have always seen high inflation as a major worry since it reduces their purchasing power and raises the cost of living. The poverty rate in the country is comparatively high, and polls reveal that more than half of all households have no savings.

According to sources, consumer prices have increased by 10.32% since the year's beginning, whereas year-to-date inflation was 5.32% in 2021. The central bank forecasts inflation to reach its target level of 4% annually in 2024.

Alexei Zabotkin, Deputy Governor of the Central Bank, stated that further choices would be based on incoming data and that the bank didn’t need to issue a signal regarding the direction of the key rate.

 

Source Credit:

https://uk.finance.yahoo.com/news/russian-weekly-consumer-prices-rise-162732617.html?guccounter=1

About Author

Garima Soni     ibmag.com

Garima Soni

Despite starting her career in science, Garima always had a zeal for writing. She started out her writer journey as a freelancer which eventually turned into a full-time job. Now as an upcoming MBA professional, Garima pens down articles for IBMag and several other we...

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