The Central Bank expects that price growth will slow to 4% as early as 2026, but inflation remains high for now.
The Central Bank of the Russian Federation has been trying to reduce inflation to the target of 4% for several years now, but has not succeeded so far.
Even harsh measures, such as setting a historically record key rate of 21%, do not help. Demand today still exceeds the economy’s ability to increase the production of goods and services, and price growth, although it has slowed, is not very significant.
For example, in November 2024, consumer prices increased by 1.43%, in December — by 1.42%. In total, the consumer price index increased by 14.2% over the year, and annual inflation accelerated to 9.52%.
At the same time, different categories of goods and services demonstrate different price growth.
For example, in December, the rise in prices for communications, fruits and vegetables slowed down, but the prices of foreign tourism services, butter, sugar and fish increased.
What will be the price increase in 2025?
Experts believe that this year inflation will most likely continue to be affected by the same main factors as last year.
In particular, agricultural products may continue to rise in price due to the high cost of agricultural machinery, seeds, as well as logistics and wages.
As for import substitution in the seed sector, experts note that such a transition is not always easy, since the quality of domestic material is still lower in many cases, and therefore the transition to it reduces production efficiency.
In addition, agricultural producers face a number of other difficulties, including a high key rate.
By the way, despite the fact that the Central Bank has stated the possibility of an even more significant increase, many analysts do not consider this measure effective in combating inflation, since it can be more significantly influenced by other factors, such as insufficient production of certain categories of goods in the Russian Federation and a weak ruble, which makes imports more expensive.
Raising the rate is not able to solve these problems, and therefore is unlikely to reduce inflation, according to a number of experts.
There is also a noticeable shortage of personnel in agriculture, which forces companies to raise salaries, and this difficulty will not disappear with a higher rate.
By the way, it makes loans expensive and almost unaffordable for many companies, which also does not contribute to the reduction in the cost of their products.
In this regard, there is every reason to believe that in 2025 inflation will also be higher than the Central Bank’s target of 4%.
Experts predict that agricultural products may rise in price by about 7%, while the overall inflation rate will be 6-6.5%.
