In Russia, for the first year recorded weekly deflation

Rosstat recorded a week-long deflation in Russia for the first time since the beginning of August 2016. As reported by the office on Wednesday, in the period from 25 to 31 July, the decline in consumer prices was 0.1% and the inflation rate since the beginning of the year to 2.6%, from the beginning of July is 0.3%.

Last year, Rosstat reported on twice a week of deflation — also in the last week of July and first week of August. Prior to this, deflation in Russia was observed in September 2011.

Cold beginning of summer in the Central part of Russia «dispersed» the price increase in June, primarily in fruits and vegetables due to fears of a poor harvest. Against this background, increased and inflation expectations of the population, which was the reason for the Bank of Russia to reduce the key rate by the Board of Directors on July 28. After the June price hike of 0.6% and a surge of 0.3% of «wage week» (26 June-3 July), the price increase became gradually slow down: two weeks, inflation was kept at 0.1%, then decreased to zero.

«Over the past week reduction of prices for fruit and vegetables on average amounted to 3.7%, including on cabbage – 14,3%, French 7.3%, and tomatoes – 6.2%, carrots – by 5.4%,» — noted in the Rosstat.

Eggs became cheaper by 1.2%, chicken oil, sunflower oil, flour, buckwheat and millet – by 0.2-0.6%. At the same time prices for sugar grew by 0.7%, beef, pork, lamb, cooked sausage, bread, rice, pasta and chocolates – 0.1-0.2%. Prices for motor gasoline and diesel fuel for the week rose 0.1%.

Rosstat said inflation for the week-long «narrow» basket of products, and monthly for «wide». The Agency has not yet published the final data on inflation for July, therefore, the valuation for July at 0.3% can be called preliminary. The Ministry of economic development predicted the deceleration of inflation in Russia in July to 0,2-0,4% in monthly terms and up to 4-4. 2% per annum. The economic development Ministry forecast inflation in 2017 — 3.8%, the target of the Central Bank — 4%. And in Ministry, and the Central Bank expect a seasonal slowdown in prices will continue, the Ministry admit deflation in August.