The food is the most expensive. The pace of growth in food prices in Russia accelerated almost 4 times and set a six-year record – 8.25 percent, and for some basic commodities they became double-digits. The governor of the Russian Central Bank – Elvira Nabiullina – may have to accelerate monetary tightening due to accelerating inflation, which is breaking records for 5 years. This “would undermine the sense of stability, and threaten the rulers with social discontent before the elections to the State Duma in September.
While analysts and economists expect Nabiullina to take soft and cautious steps, interbank participants are betting on a sharp and strong appreciation in the key exchange rate.
– Inflation in Russia will continue to accelerate and will reach 6.1-6.3% in the summer, predicts Mikhail Vasiliev, chief analyst of the USSR. “Implementation of deferred demand; inflation of the global money supply by central banks of developed countries; high commodity prices, accumulated savings, and the continued decrease in the supply of many commodities due to the pandemic – all this leads to higher consumer prices,” Vasiliev said on Thursday. Inflation expectations remain high, creating the risk of an “inflation spiral” that must stop quickly.
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