The Russian economy is expected to grow by 5.5% in the first quarter of 2022, while inflation will remain high near 8.5% in January-March, according to forecasts released today by the central bank. country.
The central bank raised its key interest rate by 100 basis points to 9.5% this month, the eighth increase since 2021, as it continues to try to curb inflation, which is double the bank’s 4% target.
The central bank expects GDP to expand by 5.5% in the first quarter, following growth of 4.7% last year, boosting strong household consumption.
At the same time, the bank forecasts annual inflation to reach 8.5% in the first quarter, drawing impetus from the weakening of the domestic currency. Annual inflation in January reached 8.7%.
The central bank, however, expects inflation at the end of the year to slow to close to 5% to 6% due to interest rate hikes it has made in recent months. However, inflation is not expected to reach close to the target of 4% to 4.5% earlier than mid-2023.
Source: Capital
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