Inflation expectations change little in first two weeks of July
According to a telephone survey of households inFOM conducted on
July saw a rise in the share of households citing growth in prices over the last two weeks. As before, among products whose prices grew most were mentioned fruit and vegetables, meat and dairy produce. At the same time, services were more often mentioned relative to previous surveys, mainly as a result of recently indexed utility rates. The proportion of respondents expecting inflation to speed up next year was unchanged from the previous survey and remained sizeable.
Also, the survey found a pickup in consumers’ evaluation of their financial standing — a benign trend owing its origin to a gradual economic recovery.
The Bank of Russia’s corporate monitoring further found a certain reduction in short-term price expectations, while they remain high. Price expectations of the agricultural sector, transport companies and storage operators proved higher, whereas those of retailers and mining sector companies declined.
Implied inflation priced in OFZ-IN bonds stayed low throughout July. Analysts’ inflation forecast for 2020 and 2021 dropped below 4%.