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Inflation in Russia

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Last updated: August 18, 2017


Russian CPI Dynamics Overview

CPI Dynamics in 2017

CPI Dynamics in 2016

CPI Dynamics in 2015

CPI Dynamics in 2005-2014

CPI Dynamics in 1995-2004


Important note: full data rows on CPI can be found in Datasheet section.



Russian CPI Dynamics Overview



After the period of hyperinflation in the end of 1980s and beginning of 1990s with year-over-year CPI reaching 2 608% (1992) that owed to disturbances in the course of market economy transition, in 1996 the prices entered the short period of relative stability that ended with 1998 crisis.[1] That crisis was one of the most severe ones in the Russian history[2], and in August 1998 the Russian Government and the Central Bank had to announce rouble devaluation and default on domestic debt together with introduction of a moratorium on payment to foreign creditors. As a result, 84% CPI growth was registered in 1998 among other multiple negative consequences of the crisis.


Dynamics of CPI in 1995-2004


Source: Russian Federal State Statistics Service.

In 1999 there started rapid recovery of the Russian economy coupled with stabilisation of inflation rates primarily due to positive developments of oil prices in the world market (see also section on GDP) and also some positive effect of devaluation on a number of industries.

As a result of constantly growing oil prices, starting from the year 2000 Russia entered the long period of growth and stability with gradually decreasing year-over-year CPI rates.


Inflation: Dynamics of CPI in 2005-2014


Source: Russian Federal State Statistics Service.

By 2011 the inflation rates had reached minimal level since the beginning of transition to the market economy, but in 2014 the economy was hit by consequences of Crimean campaign that led to introduction of sanctions over Russia in the mid-2014 and limitation of imports from a number of countries in response. The sanctions led to substantial investment outflow, limited access to financing from abroad, increasing cost of capital and overall negative expectations on the Russian economy developments. This coupled with falling oil prices resulted in rapid deterioration of local currency and, consequently, CPI substantially speeding up by the end of 2014.


Inflation: Monthly Dynamics of CPI in 2014


Source: Russian Federal State Statistics Service.

2015

In the beginning of 2015 the currency deterioration and related strong CPI growth continued and slowed down only in April 2015, when oil prices showed some stability at the level of USD 55-65 per barrel with national currency rates showing positive correction.


Inflation: Monthly Dynamics of CPI in 2015


Source: Russian Federal State Statistics Service.

CPI was projected to grow by 12.7-13.1% in 2015 by the most part of the experts (see also Inflation Forecasts section). Closer to the year end the official forecast of the Ministry of the Economic Development was at 12.5%, while the Russian Central Bank forecasted inflation in 2015 at 12.8-13.0%.

On December 31, 2015 the Russian State Statistics Service released preliminary estimate of CPI growth for 2015 (December 2015 to December 2014).[3] According to the preliminary data, overall Russian CPI demonstrated 12.9% growth over 2015. The CPI for food and beverages increased by 14.0%, CPI for non-foods increased by 13.7% and CPI for services increased by 10.2%. On January 12, 2016 the preliminary overall CPI growth estimate for 2015 at 12.9% was confirmed.[4]



CPI Dynamics in 2017




Monthly Dynamics of CPI in Russia in 2016-2017, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI in 2016-2017, to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI in 2016-2017, to December of previous year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Food and Beverages in 2016-2017, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Food and Beverages in 2016-2017, to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Nonfoods in 2016-2017, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Nonfoods in 2016-2017, to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Services in 2016-2017, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Services in 2016-2017, % to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.

July 2017:

On August 4, 2017 the Russian State Statistics Service released data on CPI in July 2017.[5] The CPI growth was estimated at +0.1% as compared to June 2017, +2.4% as compared to December 2017 and +3.9% as compared to July 2016. The decrease in prices for fruits and vegetables had substantial impact on deteriorating inflation in July.

June 2017:

On July 6, 2017, the Russian State Statistics Service published data on CPI in June 2017.[6] The CPI growth was estimated at +0.6% as compared to May 2017, +2.3% as compared to December 2016 and +4.4% as compared to June 2016. The CPI growth in June deviated from the Central Bank’s inflation target (4.0% for 2017) primarily due to increasing prices for food and beverages (+1.0% month over month), especially fruits and vegetables (+8.3%).

May 2017:

On June 6, 2017 the Russian State Statistics Service released data on CPI in May 2017.[7] The CPI growth was estimated at +0.4% as compared to April 2017, +1.7% as compared to December 2016 and +4.1% as compared to May 2016.

April 2017:

On May 5, 2017 the Russian State Statistics Service published data on CPI in April 2017.[8] The CPI growth was estimated at +0.3% as compared to March 2017, +1.3% as compared to December 2016 and +4.1% as compared to April 2016.

March 2017:

On April 5, 2017 the Russian State Statistics Service released data on CPI in March 2017.[9] The CPI growth was estimated at 0.1% as compared to February 2017, 1.0% as compared to December 2016 and 4.3% as compared to March 2016.

February 2017:

On March 7, 2017 the Russian State Statistics Service released data on CPI in February 2017. The CPI growth was estimated 0.2% as compared to January 2017, 4.6% as compared to February 2016 and 0.8% as compared to December 2016.[10]

January 2017:

On February 6, 2017 the Russian State Statistics Service released the estimate of CPI growth for January 2017.[11] The CPI growth was estimated at 0.6% as compared to December 2016 and 5.0% as compared to January 2016.



CPI Dynamics in 2016



The CPI growth for 2016 was estimated at 5.4% (year end) and 7.1% (year average) by the Russian State Statistics Service.[12]

Having inflation targeting policy in mind, the state stuck to very conservative monetary policy in 2016 keeping the base rate relatively high in order to retain inflation expectations at a moderate level. Specifically, over the year the base rate was corrected twice from 11.0% to 10.0%, while the CPI growth after 3Q 2016 was only at 4.5% as compared to December 2015 and the registered monthly inflation rates in 2nd and 3rd quarters were in the range of 6.1-7.5% as compared to appropriate periods of previous year.

The Russian Central Bank’s inflation target for 2016 was in the range of 5.5-6.0%. Given the negative developments of oil prices in the beginning of 2016 and quite challenging environment for execution of the Russian budget, in the first half of the year one could hardly believe that it would be possible to implement those plans. Even after the strong positive correction of the crude’s price in April-May 2016, the monthly inflation rates stayed outside of the planned trajectory with inflation expectations remaining relatively high. The Central Bank, on the one hand, confirmed those concerns pointing at substantial risks in relation to the state’s ability to implement inflation targeting strategy for the medium term with a chance for inflation rates freezing at around 6-7% per annum.[13] On the other hand, even in the times of the lowest crude’s price, the Bank’s representatives were issuing statements that inflation targets still seemed to be realistic[14].

Projections Made Throughout 2016

In 2015 available CPI forecasts for 2016 mostly assumed 6-8% CPI growth. The official forecast of the Ministry of Economic Development was 6.4% CPI growth in 2016, and that forecast was used for the Russian budgetary projections for 2016. In the end of November 2015 Mr. Alexey Vedev, the Deputy Minister of Economic Development, assumed CPI growth in 2016 to be in the range of 6.4-6.9%.[15]

Deteriorating oil price dynamics closer to the end of 2015 designated substantial risks and challenges for achieving 2016 inflation targets (6.4% under the law on the federal budget for 2016). The mentioned risks actually started to materialize in January 2016, when the authorities had to revise their inflation projection under the base scenario providing 8.5% CPI growth forecast for 2016 as a result of rapidly deteriorating oil prices with increasing budget deficit threat.[16]

Even after noticeable national currency deterioration, the Russian authorities have been keeping a lot of optimism on their capacity to manage inflation. Specifically, on February 3, 2016 Mr. Alexey Ulyukaev, the Russian Minister of Economic Development, commented that even if the average annual crude oil price drops to USD 25 per barrel in 2016, the inflation for the year will not exceed 10%.[17]

After the positive correction in crude oil prices that took place in the end of February – beginning of March 2016 the national currency also strengthened with RUR/USD rate decreasing to 73.18 by March 7, 2016. Observed growth in oil prices together with prospects related to discussions of OPEC countries on limiting crude oil supply created ground for improving inflation projections. The experts’ projections median for CPI growth in 2016 stayed at 8.6% for projections made in February-March 2016.

Owing to strong growth in the crude oil price in April-May 2016, the macroeconomic projections for 2016 had improved for Russia. Besides this, the state also showed continuous and strong commitment to inflation targeting strategy. As a result, the CPI growth projections for 2016 had been further decreased closer to the Central Bank’s inflation targets. Specifically, in May 2016 IMF revised the Russian inflation projection for the year to 6.4%.[18]

In June 2016 the most part of analysts kept their Russian inflation projections for 2016 in the range of 6.5-7.5%. The removal of travel ban and start of lifting trade sanctions put on Turkey in the very end of June 2016 led to cautious optimism on ability of Russia to meet the updated inflation targets for the year (5.0-6.0%). Specifically, analysts of VTB Capital, an investment banking business of VTB group, considered the effect of sanctions removal on inflation rates at -0.5% and the year-end inflation for 2016 at 6.0-6.3%.[19] The revised inflation projections of IMF released in the mid-July 2016 (6.6% for 2016, year-end) also showed expectations of slowing down CPI growth primarily due to “negative output gap and the lack of aggregate demand pressures”.[20]

In August 2016 there was registered a flat CPI growth (0%) for the first time in the last 5 years, and the yearly inflation rates at 6.0-6.5% started looking more realistic. However, the inflation trajectory still was a bit above 5.5% intermediate 2016 target of the Russian Central bank.[21]

On September 16, 2016 after decreasing the base rate from 10.5% to 10.0% the Russian Central Bank announced that it does not plan further changes in the base rate until 2017.[22] With the base rate substantially above the inflation rates lowering inflation expectations have been observed leading to further CPI deterioration closer to the year end. The median of experts’ inflation projections for the year shifted to 5.8% in September-October (December to December of previous year).


Monthly Dynamics of CPI in Russia in 2016, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI in 2016, to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI in 2016, to December of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Food and Beverages in 2016, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Food and Beverages in 2016, to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Nonfoods in 2016, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Nonfoods in 2016, to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Services in 2016, Month over Month


Source: Russian Federal State Statistics Service.


Monthly Dynamics of CPI for Services in 2016, % to Appropriate Period of Previous Year


Source: Russian Federal State Statistics Service.

December 2016 (2016 as a whole):

On January 10, 2017 the Russian State Statistics Service released information on CPI in December 2016 (2016 as a whole).[23] The CPI was estimated at 100.4% as compared to November 2016 and 105.4% as compared to December 2015. Therefore, the official inflation estimate for 2016 is 5.4%.The CPI in January-December 2016 (year average) is estimated at 107.1% as compared to January-December 2015.

November 2016:

On December 6, 2016 the Russian State Statistics Service released information on CPI in November 2016.[24] The CPI was estimated at 100.4% as compared to October 2016, 105.0% as compared to December 2015 and 105.8% as compared to November 2015. The CPI in January-November 2016 is estimated at 107.2% as compared to January-November 2015.

October 2016:

On November 3, 2016 the Russian State Statistics Service released data on the Russian CPI in October 2016.[25] The CPI was estimated at 100.4% as compared to September 2016, 104.5% as compared to December 2015 and 106.1% as compared to October 2015. The CPI growth in January-October 2016 was at 107.4% as compared to appropriate period of 2015.

September 2016:

On October 4, 2016 the Russian State Statistics Service disclosed CPI estimates for September 2016.[26] The Russian CPI was estimated at 100.2% as compared to August 2016, 104.1% as compared to December 2015 and 106.4% as compared to September 2015. The CPI growth in January-September 2016 was at 107.5% as compared to appropriate period of 2015.

August 2016:

On September 5, 2016 the Russian State Statistics Service released information on CPI in August 2016.[27] The CPI was estimated to remain at the level of July 2016 with no registered month-over-month growth (100% as compared to July 2016), 106.9% as compared to August 2015 and 103.9% as compared to December 2015. The overall CPI for January-August 2016 was at 107.6% as compared to appropriate period of 2015.

July 2016:

On August 4, 2016 the data on the Russian CPI in July 2016 were released by the Russian State Statistics Service.[28] The CPI growth is estimated at 100.5% as compared to June 2016, at 107.2% as compared to July 2015 and at 103.9% as compared to December 2015. The CPI for January-July 2016 was at 107.8% as compared to appropriate period of 2015.

June 2016:

On July 5, 2016 the Russian State Statistics Service released data on CPI in June 2016.[29] In accordance to the presented data, CPI is estimated at 100.4% as compared to May 2016, at 107.5% as compared to June 2015 and at 103.3% as compared to December 2015. The CPI for January-June 2016 (1H 2016) was at 107.8% as compared to 1H 2015.

May 2016:

On June 6, 2016 the Russian State Statistics Service published the information on CPI in May 2016.[30] In accordance to the presented data, CPI is estimated at 100.4% as compared to April 2016, at 107.3% as compared to May 2015 and at 102.9% as compared to December 2015. The CPI for January-May 2016 was at 107.9% as compared to appropriate period of previous year.

April 2016:

On May 5, 2016 the Russian State Statistics Service released information on CPI in April 2016.[31] In accordance to the presented data, CPI is estimated at 100.4% as compared to March 2016, at 107.3% as compared to April 2015 and at 102.5% as compared to December 2015.

March 2016:

On April 5, 2016 the Russian State Statistics Service released information on CPI in March 2016.[32] In accordance to the statistics data, CPI is estimated at 100.5% as compared to February 2016 and at 107.3% as compared to March 2015.

February 2016:

On March 4, 2016 the Russian State Statistics Service published information on CPI in February 2016[33]. Referring to released data, CPI for February is estimated at 100.6% as compared to previous month and at 108.1% as compared to February 2015. The CPI since the beginning of 2016 was estimated at 101.6%.

January 2016:

On February 5, 2016 Rosstat released data on CPI for January 2016.[34] CPI was estimated at 101.0% month over month (compared to December 2015) and 109.8% as compared to January 2015.



CPI Dynamics in 2015



On January 12, 2016 the preliminary overall CPI growth estimate for 2015 at 12.9% was confirmed by the Russian State Statistics Service.[35]


Inflation: Monthly Dynamics of CPI in 2015


Source: Russian Federal State Statistics Service.


Inflation: Monthly Dynamics of CPI for Food and Beverages in 2015


Source: Russian Federal State Statistics Service.


Inflation: Monthly Dynamics of CPI for Nonfoods in 2015


Source: Russian Federal State Statistics Service.


Inflation: Monthly Dynamics of CPI for Services in 2015


Source: Russian Federal State Statistics Service.



CPI Dynamics in 2005-2014




Inflation: Dynamics of CPI in 2005-2014


Source: Russian Federal State Statistics Service.


Inflation: Dynamics of CPI for Food and Beverages in 2005-2014


Source: Russian Federal State Statistics Service.


Inflation: Dynamics of CPI for Nonfoods in 2005-2014


Source: Russian Federal State Statistics Service.


Inflation: Dynamics of CPI for Services in 2005-2014


Source: Russian Federal State Statistics Service.



CPI Dynamics in 1995-2004




Inflation: Dynamics of CPI in 1995-2004


Source: Russian Federal State Statistics Service.


Inflation: Dynamics of CPI for Food and Beverages in 1995-2004


Source: Russian Federal State Statistics Service.


Inflation: Dynamics of CPI for Non-foods in 1995-2004


Source: Russian Federal State Statistics Service.


Inflation: Dynamics of CPI for Services in 1995-2004


Source: Russian Federal State Statistics Service.



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