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slightly more optimistic – in 2022 the Russian economy will show a milder than initially expected decline (in a range of 3-3.5% v 4-6% in July forecast). In line with that, the CBR also narrowed its YE22 inflation forecast range to 12-13% v 12-15% in July. In 2023, YE inflation is not expected to break out of the range of 5-7%.
§ BCS forecast. In its statement, CBR points out that in its future decisions it will carefully assess the Russia’s economic performance and inflationary backdrop. As we don’t expect that inflationary expectation as well as financial volatility to decline in S-T, a ‘no change decision’ seems a more likely scenario at the next CBR meeting. However, we cannot rule cannot rule out that the CBR will take another step in its rate cut cycle (within 25 bp step) amid subdued consumer demand.
92 RUSSIA Country Report December 2022 www.intellinews.com