Economist Nikolaev: “A slowdown in prices is not visible, although the harvest season has already begun.”
Inflation in Russia continues to gain momentum. According to Rosstat on the consumer price index, inflation in June 2024 amounted to 0.64%. Since the beginning of the year, prices have increased by 3.88%. And in annual terms, inflation has already reached 8.59%. The saddest thing for the population is that food prices are rising at an accelerated pace. Will the authorities be able to reverse this process? There is some hope for this — after all, July and August are the months in which in previous years deflation — a decrease in prices — was most often observed.
Compared to the same period last year, food prices increased by 10.44%. Including bread and bakery products by 10%, meat and poultry by 16.29%, chicken eggs by 45%. Even in the beginning of the mass harvesting season of vegetables, these products turned out to be in the general trend and increased in price by 19.13%.
And although the Minister of Agriculture Oksana Lut recently announced that the volume of agricultural production over the five months of the year increased by 7 %, food prices, as we see, have no intention of slowing down.
However, according to Central Bank forecasters, inflation will reach peak levels this month and then begin to decline. The thesis is not indisputable. Judge for yourself. Last month, inflation was 0.64% after 0.74% in May. But annual inflation is still accelerating – to 8.59% from 8.3% at the end of May. But, according to the regulator, it will begin to decline in August-September.
True, it has not decreased yet, and this is clearly visible from the prices in the stores. Even fruit and vegetable products — it is the season after all — have increased in price segment. In June, potatoes became significantly more expensive — by 33.7%. Here there is a question about pricing. Potato growers themselves assure that the May frosts practically did not damage the plantations of the «second bread», unlike other agricultural crops. And in stores, domestic potatoes of the new harvest today cost 40 rubles per kilogram.
As for other vegetables, according to Rosstat, carrots increased in price by 6.3%, apples by 10.2%. To be fair, it should be noted that during this period, prices for tomatoes decreased by more than 13%, white cabbage by 10% and cucumbers by almost 8%. For how long?
While economists are making their forecasts and getting confused about percentages, farmers themselves say that the year will not be entirely successful for them. The explanation is irrational. 2024 is a leap year. And in the memory of old-timers, there has never been a time when a leap year was successful for the peasants. And now — either May frosts or July drought…
— The June report of Rosstat is important. But even more important is what happened with inflation in the first week of July, from the 2nd to the 8th, says Igor Nikolaev, chief researcher at the Institute of Economics of the Russian Academy of Sciences. — Data from the statistics department has already been released: during this period, inflation increased by almost 0.3%. This suggests that prices continue to rise. 0.3% per week is a lot, more than one percent is gained in a month. This has a significant impact on wallets.
— By and large, this factor should already manifest itself. But, again, if you look at the first week of July, then, according to Rosstat, there is no significant decrease. Although mass harvesting of vegetables in the southern regions of the country is already underway. Yes, some vegetables have become a little cheaper. But potatoes increased in price by 1.6%. Cucumbers by 3.6% — and this is just in a week. Now even ground cucumbers are on sale, not to mention greenhouse ones. There must be a lot of them. And the price jumped by almost 4% over the week. White cabbage added 4.4%…
— If you look at this dynamics, a slowdown in price growth is not visible, although the harvest season has already begun. Of course, we can hope for a future decline in price, and to some extent it will definitely happen. But this factor clearly should not be overestimated.
— Most likely — yes, probably up to 18% from the current 16%. The regulator is determined. As of July 8, inflation accumulated since the beginning of the year is 4.7%, and there is still almost six months ahead.
— I believe that with great effort, but the authorities will be able to squeeze in 8% or 9% at the end of the year. But the risks are growing.