Russian weekly consumer prices rise more slowly before rate decision

Weekly consumer prices in Russia rose again but more slowly than the week before, data showed on Wednesday, all but confirming widely-held expectations that the central bank will keep its key interest rate on hold when it meets on Friday.

Russia’s consumer price index rose 0.19% in the week to Dec. 12, the Rosstat federal statistics service said, up from a 0.58% rise a week earlier. Since the start of the year, prices have jumped 11.86%, compared with 8.39% in 2021.

An indexation of utility tariffs had seen consumer prices accelerate more quickly in the previous week.

Prices for fruits and vegetables continued to rise quicker than most items in the basket, up 2.7% on average. Rosstat said prices of cucumbers had risen 8.2% in the last week.

The cost of an economy class flight ticket was up by 8.6% from a week ago, after a 5.7% rise last week.

In a separate set of data, Russia’s economy ministry said that inflation was running at an annualised rate of 12.65% as of Dec. 12, up from 12.50% a week before.

All 23 analysts and economists polled by Reuters expect the Bank of Russia to hold rates at 7.5% at its final meeting of the year on Friday, as inflation continues to slow and in order to assess the possible economic impact of the oil price cap and embargo.

The central bank targets inflation at 4%, which it aims to achieve by 2024. It has forecast inflation to fall to 5%-7% next year.

High inflation has for years been a concern for Russian households as it dents their spending power and eats into living standards. Poverty rates are relatively high in Russia and surveys show more than half of all households have no savings.