BOFIT Viikkokatsaus / BOFIT Weekly Review 2015/38
Russian 12-month inflation accelerated to nearly 16 % in August. The CBR now sees inflation slowing to 7 % by September 2016, and further expects to reach its 4 % inflation target in 2017. As one of the major risks for inflation the CBR regards further deterioration of international economic conditions. If world oil prices would drop further and uncertainty on international financial markets would increase, the ruble would be subjected to further depreciation pressures causing increased inflation risks. The CBR has, however, estimated that the net outflow of private sector capital has slowed in recent months, which eases depreciation pressure on the ruble. According to preliminary CBR figures, private sector net capital outflow in the first eight months of the year amounted to $52 billion, while the current account surplus for the period was about $51 billion.
Among other inflation risks the CBR mentioned possible changes in planned hikes in regulated prices in 2016 and 2017 and relaxation of fiscal policy.