According to Rosstat, during 1-20 August, CPI advanced 0.2%, with 0.1% WoW growth last week, bringing YoY growth to 5.9% so far. In 14-20 August, average daily price growth doubled to 0.012% from 0.006% in the previous week (the same week of last year registered 0.002% daily deflation). The key CPI movers were flour (+1.4% WoW), chicken (+1.1% WoW), millet (+0.6% WoW), and bread (9+0.5-0.7% WoW), while fruit and vegetables prices continued to fall, down 3.5% WoW on average.
Harvest problems pushed CPI growth higher via wheat-related products. At the same time, fruit and vegetables were cheaper last week due to seasonality, but at a lesser pace compared with 4.4-5.6% WoW in August 2011. We reiterate our forecast of an increase of 0.2-0.3% MoM and 6.0-6.1% YoY in consumer prices in August.
Maxim Oreshkin, Daria Isakova, Dmitri Fedotkin, Mykyta Mykhaylychenko
VTB Capital analyst
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