"Return to planned indicators": the Kremlin told about measures to curb inflation in Russia

The Kremlin is concerned about the rise in inflation in Russia, but the authorities are taking all necessary measures to stabilize prices.

This was announced on Thursday, December 15, by the presidential press secretary Dmitry Peskov.

“Inflation is high, and the president’s goal is to do everything possible to bring it back to the planned indicators as soon as possible.

There is pressure from both external and internal factors.

Unfortunately, it continues unabated.

And this pressure in the world economy is also felt no less, and maybe even somewhere even more strong.

In this regard, yes, this is a topic for concern, ”said Peskov.

The press secretary of the head of state called the curbing of prices a difficult process that requires a lot of constant work.

This is what the government is doing now, the Kremlin spokesman said.

According to Rosstat and the Ministry of Economic Development and Trade, in November 2021, consumer prices in the country increased by an average of 8.4% compared to the same period in 2020, and the achieved annual inflation rate peaked in almost six years.

Note that since the beginning of winter, the annual growth rate of consumer prices in Russia has slowed down somewhat - by mid-December, the figure dropped to 8.11%.

At the same time, the level of inflationary expectations of the population continues to grow and is now about 15%, according to the materials of the Central Bank.

As the head of the Central Bank Elvira Nabiullina explained earlier, the growth of inflationary expectations suggests that people are afraid of further appreciation of goods and begin to make large purchases earlier than originally planned.

Such actions increase consumer demand, as a result of which the cost of production rises faster.

“Our inflation expectations - how we perceive current inflation and what we expect in the future - reflect, of course, the memory of long years of high inflation.

On the eve of the pandemic, inflationary expectations had just begun to decline, approaching 4%.

And the pandemic, of course, has mixed all the cards.

Inflationary expectations have grown strongly this year and have rolled back to the level of five years ago, ”Nabiullina said in November.

The fallout from the coronavirus pandemic has led to problems with logistics and delivery of goods around the world.

This, in turn, had a negative impact on the final cost of goods and services in most countries, explained Alexei Kanevsky, chairman of the committee on economics of the Moscow branch of the all-Russian public organization of small and medium-sized businesses "Support of Russia".

“Thus, inflation is a global problem, and Russia, of course, is included in this process.

We are seeing an increase in the cost of services, raw materials, goods from abroad, as well as products that use imported components.

This gave an increase to the final price of the product for the consumer, "said the interlocutor of RT.

One of the internal reasons for high inflation in Russia was the overpricing of large retail chains, says Georgy Ostapkovich, director of the Center for Market Research at the Institute for Statistical Studies and Economics of Knowledge at the Higher School of Economics.

In addition, according to him, the cost of goods was affected by relatively weak harvest indicators, as well as the rise in labor costs in a number of industries.

“If we talk about food, then large chains control 40-45% of the turnover and can set negotiated prices.

Plus, this year was not the best harvest, since fertilizers rose in price, and the farmers had to save.

At the same time, the number of labor migrants, who occupy a significant share in construction and agriculture, has decreased, ”explained Ostapkovich.

Together

According to the October forecast of the Central Bank, by the end of 2021, inflation in Russia will be in the range of 7.4-7.9%.

To keep prices down, the regulator has been actively raising the key rate in recent months.

Against the backdrop of the Central Bank's actions, Russian banks are beginning to raise interest rates on loans and deposits.

As a result, according to experts, consumer demand in the country is weakening and savings are increasing, which should put pressure on prices.

• © Anton Belitsky / Global Look Press

The last change in the key rate took place in October.

Then the Bank of Russia raised it to 7.5% per annum.

The next meeting of the Board of Directors of the Central Bank is scheduled for December 17.

At the same time, during its final meeting in 2021, the top management of the regulator may increase the rate by 100 basis points at once - up to 8.5% per annum.

Elvira Nabiullina did not rule out such a possibility earlier.

“We are now moving within the framework of the baseline scenario.

At the last meeting of the board of directors, we outlined how we see the range of the rate until the end of this year: there is a range from zero to 100 (basis points. -

).

We will consider a solution in this range.

But I must say, of course, that now the forecast for inflation is rather at the upper limit of our forecast, we will take this into account, "the head of the Central Bank noted.

As Pyotr Pushkaryov, chief analyst of TeleTrade Group of Companies, suggested in a conversation with RT, today the Bank of Russia has used almost all possible tools in the fight against price increases.

Against this background, the government's actions should be decisive for reducing inflation in the coming months.

“For these efforts to be effective, the Cabinet of Ministers needs to more actively allocate direct subsidies and provide tax incentives to backbone and small businesses.

First of all, such support is needed by farmers and processing plants.

This will allow enterprises to reduce costs and maintain profitability without raising prices anymore, ”the expert said.

Earlier, the Minister of Agriculture of Russia Dmitry Patrushev announced the government's plans in 2021 to allocate an additional 10 billion rubles for the provision of subsidies to meat producers.

It is assumed that the money will allow enterprises to reimburse part of the cost of purchasing feed.

At the same time, it is planned to increase the amount of material assistance in 2022, the head of the Ministry of Agriculture noted.

In addition, in the new year, Patrushev proposed setting tariff quotas for sugar imports and zeroing duties on meat imports.

It is also planned to introduce an export quota for grain and, if necessary, revise the parameters of floating duties on the export of this product from Russia.

Moreover, in 2022, the Cabinet of Ministers is going to allocate an additional 5 billion rubles to support vegetable growing.

Producers will receive money from the state for the expansion and modernization of production, as well as for the construction of storage facilities.

Small and medium-sized farms will be helped to ensure direct marketing of products.

“Taking into account the measures taken, I think somewhere before February 2022 we can observe an increase in prices.

However, already in March-April, inflation is likely to fall on a plateau, and from May it will begin to decline.

Thus, by September we will reach the target level of 4–4.5%, maximum 5%, ”suggested Georgy Ostapkovich.