Russia: CPI – January; disinflation takes hold
Last month, headline CPI decelerated 0.4pp to 6.1% YoY, in line with our and the consensus estimates. January’s inflation slowed on moderating food and tariffs inflation. Core inflation remained in check despite some price gains across non-regulated services. That said, early February disinflation continued and the recent weekly CPI report implies that headline inflation has slid to 6.0% YoY, thanks to deflation in eggs and slow gasoline inflation. Looking ahead, we expect disinflation to gather pace through the rest of the year due to lower tariff and food price gains, as well as cyclical disinflation in the core basket. FX pass-through is the biggest risk, but it would not put at risk the 5.0% CBR target, on our estimates. Policy-wise, the report is likely to be neutral, and we expect the CBR to remain on hold over the coming months.
Maxim Korovin, Antin Nikitin
VTB Capital analyst
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