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Central Bank: Price growth in May slowed down to the level of the beginning of 2020

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Central Bank: Price growth in May slowed down to the level of the beginning of 2020


© Igor Samokhvalov/PG

The monthly increase in prices in May slowed down significantly (to 0.18%), dropping below the level corresponding to 4% inflation. A similar price growth rate was last observed in January-February 2020, according to materials posted on the Bank of Russia website.

According to the regulator, “such a low increase in prices” in May was not observed before.

“Annual inflation also decreased, amounting to 17.1%,” the report says.

Moreover, the rise in prices slowed down for most goods and services. However, the increase in prices for more than 60% of the components of the consumer basket last month exceeded 4% in annual terms. “The high share of fast-rising goods and services is associated with cost pressures, which are also growing due to logistical difficulties and interruptions in the supply of imported intermediate products,” the regulator explained.

At the same time, prices for a quarter of the components of the consumer basket fell, and in the category of non-food products, almost every second product fell in price. “This reflected a price correction after the March jump as a result of a pause in demand and a stronger ruble. It was the cheapening of individual goods against the backdrop of a general increased inflation that ensured such a strong slowdown in the monthly increase in prices,” the Central Bank said.

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According to the regulator’s forecast, annual inflation will be 14-17% in 2022, drop to 5-7% in 2023 and return to 4% in 2024.

Last week, Rosstat reported that cabbage, fresh cucumbers, and tomatoes continue to fall in price in Russia. On average, fruits and vegetables fell in price by three percent over the week. However, potatoes continued to rise in price. Its cost for the week increased by 1.6 percent (a week earlier – by 2.1 percent, since the beginning of the year – by 41.2 percent).

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