Russian MinFin expecting 7.2%-7.3% inflation in annual terms in April

Inflation in annual terms will be 7.2 percent-7.3 percent in April before peaking at 7.5 percent in May or June, the head of long-term strategic planning at the Finance Ministry, Maxim Oreshkin, told journalists on Monday.

Inflation in annual terms will be 7.2 percent-7.3 percent in April before peaking at 7.5 percent in May or June, the head of long-term strategic planning at the Finance Ministry, Maxim Oreshkin, told journalists on Monday.

"Slow economic growth will reflect on inflation. In March [it will be] 6.9 percent, [and] in April we are expecting 7.2-7.3 percent," he said, adding that inflation will peak at 7.5 percent in May or June. "Decline will occur beginning in June or July, and we are expecting inflation significantly below 6 percent by the end of the year," Oreshkin said.

The main factor that influences inflation, he said, is much smaller tariff indexation for the public. "This factor alone is an instant half a percentage drop in inflation," Oreshkin said.

"Prices for milk, eggs and cheese play a large role for inflation. For March, these products accounted for 0.8 percent of 6.9 percent [inflation]. Milk grew 17.4 percent year-on-year in price in March, eggs - 14.7 percent [and] cheese - 22.4 percent," he said.

These products are also expected to peak in the coming months, Oreshkin said. "We see decent profitability for dairy products, [and] with this we are expecting that prices for these goods will stop growing in the second half of the year, and may even fall," he said.

Another factor that influences inflation is the ruble's weakening exchange rate, Oreshkin said. "The carry-over effect is being seriously felt in prices for imported products. This effect will decline by May or June," he said.

Read more: Net capital outflow from Russia at $70 bln-$80 bln in 2014; current account surplus - $50 bln

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