In December the Rate of Inflation will Accelerate due to Higher Cost of Dairy Products

It is to be noted that depreciation of the ruble could have contributed to some extent to acceleration of the rate of inflation taking into account a large share of import goods in consumption. On the basis of the results of 16 days in December, the consumer price index amounted to 0.3% (0.3% in the same period of 2012). As a result, cumulative inflation from the beginning of the year amounted to 6.2% (6.3% in the same period of 2012). The main factor which kept the inflation rate in check was absence of explicit pressure on prices on the part of demand, as well as a favorable situation with yield of grain and bean crops and improvement of the situation on the global agrarian market.

In November, the inflation rate remained high: on the basis of the results of the month the consumer price index amounted to 0.6% (as in October 2013) and was 0.3 p.p. higher than the respective index of 2012. As a result, the rate of inflation year on year amounted to 6.5%. In November 2013, the base inflation rate amounted to 0.6% and happened to be equal to the respective index of last year.

In November, prices on food products rose by 0.7% against October 2013. There was a slowdown of growth rates of prices on fish and sea products (from 1.2% in October to 0.7% in November), horticultural products (from 3.6% to 3.0%) and eggs (from 18.2% to 11.6%). Growth rates of prices on butter (from 2.7% in October to 2.8% in November) and milk and dairy products (from 0.4% in October to 1.6% in November) increased. Prices kept decreasing on grain and bean products (from 0.5% in November to 0.3% in October), white sugar (from 2.7% in November to 2.6% in October), sunflower oil (from 1.2% to - 0.6%) and alimentary products (from 0.6% to 0.1%). So, the largest contribution to growth in prices on food products was made by growth rates of prices on ingredients of animal origin and fruit and vegetable products. Growth in prices on butter and dairy products and eggs was justified by a shortage of primary materials due to a limited amount of forage because of a poor yield of 2012. Appreciation of prices on fruit and vegetable products from October 2013 is related to a seasonal factor.

А.V. Bozhechkova, Researcher