Russia's economic system is anticipated to expertise accelerated inflation in the beginning of 2026, pushed by greater tariffs and a rise within the value-added tax (VAT).

Supply: Elvira Nabiullina, Head of the Central Financial institution of Russia, at a press convention on Friday 19 December, as reported by The Moscow Instances, an unbiased Amsterdam-based information outlet

Particulars: Nabiullina mentioned that this 12 months value progress in Russia slowed to a five-year low, falling beneath 6%.

Nonetheless, "the VAT enhance might considerably have an effect on costs within the coming months," she famous.

"Some firms have begun adjusting costs with this in thoughts in December, however the primary influence continues to be forward," Nabiullina mentioned, including that cuts to the important thing rate of interest wouldn’t proceed "on autopilot".

Background: On Friday, the Russian Central Financial institution reduce its key charge for the fifth time this 12 months, from 16.5% to 16%. Nonetheless, Nabiullina mentioned that holding the speed unchanged had additionally been thought of. Along with VAT, the Central Financial institution sees inflation dangers stemming from oil costs, which for Russian blends have fallen beneath US$40 per barrel. This "might have pro-inflationary results by rouble alternate charge dynamics," the regulator mentioned.

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