Russia: Inflation falls in December
December 31, 2015
Preliminary data released on 31 December by the Federal Statistics Office (Rosstat) showed that consumer prices rose 0.8% over the previous month, which followed a similar increase in November. The reading fell short of the 0.9% rise the markets had expected. More complete data will be released on 13 January.
Inflation fell sharply from 15.0% in November to 12.9% in December. The reading marked a fourth consecutive decline from the peak registered in August (15.8%) and the lowest rate in 2015, despite the weakening of the Russian ruble and the recent embargo on Turkish products. Inflation slowed significantly in December 2015 due a base effect, as the annual variation in consumer prices rose notably in December 2014. Moreover, due to the base effect, inflation is expected to continue easing in the coming months, but upward pressures to consumer prices are likely to come from the persistent weakness in the Russian ruble and Russia’s ban on imports from Turkey and Ukraine. Inflation closed 2015 above the Central Bank’s inflation target of 4.5%.
Author: Ricardo Aceves, Senior Economist