Page 41 - RusRPTAug23

4.2 Inflation
Inflation fell to record lows in the first quarter but underling inflation pressures are growing and inflation is expected to rise in the second half of this year. The CBR has already reversed its loosening policy and put in the first rate hike in July. Inflation is expected to end the year at around 6% before falling again to the CBR’s target rate of 4% in 2024.
4.2.1 CPI dynamics
4.2.2 PPI dynamics
Between July 18 and July 24, inflation accelerated from 0.18% to 0.23%. Year-on-year inflation reached 4.19%. This increase is primarily a knock-on effect of the exchange rate on prices. Last week, the Central Bank increased interest rates by a percentage point to 8.5%.
Producer prices in Russia rose 3.8% y/y in September of 2022, the same as in the previous month and remaining the lowest increase since December last year. Main upward pressure came from electricity, gas, steam & air conditioning (5%), followed by water supply (4.9%), manufacturing (4.7%) and
41 RUSSIA Country Report August 2023 www.intellinews.com