According to the report, the revision of the forecast is due to more restrained actual inflation figures, as well as updated expectations regarding utility tariffs and prices for fuel and lubricants (F&L). Additionally, a more cautious assessment of the impact of the value-added tax (VAT) on inflation has been made.
Going forward, the regulator expects that the contribution of prices for housing and communal services and F&L to inflation will decrease, and the rate of price growth will slow down to 5.5-7.5% in 2027.
“The decrease in annual inflation will be supported by the fading high base of the previous year and the impact of the current strengthening of the exchange rate on price formation in the country. However, in 2026, inflationary risks will remain, driven by a complex interplay of both external and internal factors. Among the external factors are high prices in global food markets, a strong ruble, and high inflation in Russia, exceeding the target level. Internal factors include rising costs for producers and sustained consumer demand,” noted the Central Bank.
