Rosstat – Russia’s Central Statistics Board – has released figures for inflation at the end of July, which show the fall in inflation in Russia breaking all forecasts.
Prices in Russia grew only 0.1% in July. In the last week of July prices actually fell. The result is that the annual rate of inflation at the end of July fell to 3.9% from 4.4% at the end of June, when inflation briefly rose because of seasonal factors.
August is usually a month of falling prices in Russia, so it is likely annual inflation will be significantly below 3.9% at the end of the summer.
The usual pattern of inflation in Russia is for a rise in prices towards the end of the winter as the Christmas/New Year holiday season approaches. Even allowing for this it is now a virtual certainty that the inflation in Russia throughout the whole year will be well below the 4% target set by the Central Bank.
A target which was widely thought unachievable just a short time ago now looks certain to be exceeded.