Russian data shows consumer prices rise eased slightly in March

MOSCOW (Reuters) – Russia’s weekly consumer price rise eased slightly in the week to March 27, data from state statistics service Rosstat showed on Wednesday, as authorities seek to bring down inflation which was almost 12% for 2022.

Russia’s central bank held its key interest rate at 7.5% earlier this month, maintaining its hawkish stance as a widening budget deficit and labour shortages pose ongoing inflationary risks, and said rate hikes were more likely than cuts this year.

Consumer prices rose 0.05% in the week to March 27, Rosstat said, compared with a 0.10% rise the previous week. Since the start of the year, prices have risen 1.47%, a slower pace than in the same period of 2022, Rosstat said.

A 0.17% rise in March is far slower than the 7.61% in the same month last year.

A separate set of data published by the economy ministry showed inflation on an annual rate fell to 4.30%, down sharply from 5.99% a week earlier.

Russian households regularly cite inflation as their main concern, with many having no savings after a decade of economic crises and rising prices dragging down living standards.

“We need to ensure a sustainable increase in domestic demand, which in the current situation is becoming the leading driver of economic growth,” President Vladimir Putin told a government meeting on Wednesday.

“At the same time, I will note that domestic demand dynamics must be in line with the Bank of Russia’s inflation target. It is important not to allow either an acceleration or excessive slowdown (of inflation),” Putin said.

Russia’s annual inflation rate in 2022 was 11.9%, almost three times the official 4% target. The central bank forecasts inflation will be 5%-7% this year, falling to 4% in 2024.

(Reporting by Darya Korsunskaya and Alexander Marrow; Editing by Alexander Smith)