Page 30 - bne IntelliNews Russia Country report May 2017

4.2.1 CPI dynamics
The Consumer Price Index in Russia registered 4.1% year-on-year increase in April 2017 , down from 4.3% seen in March and 5% in January, the Rosstat statistics agency reported on May 5.
The annual consumer price growth has almost reached the 4% target set by the Central Bank of Russia , which has managed to curb the CPI more than threefold from the beginning of 2016 to the lowest in post-Soviet history .
The disinflation trend continued , despite the notable acceleration of weekly and daily consumer price metrics in April that alarmed the analysts.
The acceleration of weekly and daily inflation in April led the analysts to believe that the Central Bank of Russia (CBR) will hold back the monetary easing started in March with a 25bp key interest rate cut to 9.75%. Nevertheless, the CBR on April 28 cut the key interest rate by another 50bp to 9.25% , defying expectations. In its accompanying statement, the CBR expressed confidence that the 4% inflation target will be reached in 2017, even given the remaining inflationary risks. The high discrepancy between the expectations based on weekly Rosstat data and the monthly results in April are a reminder of how the agency came under fire earlier this year over the accuracy of its data.
Alfa Bank on April 28 argued that “inflationary trend thus far in 2017 has turned out to be unpredictable ” and warned that declining predictability of inflation seen in April “complicates the CBR’s ability to guide the market”.
30 RUSSIA Country Report May 2017 www.intellinews.com