Russian min: Inflation may overshoot ’15 forecast, poverty at 12.4%

MOSCOW, Feb 17 (PRIME) -- Russia’s inflation may exceed the earlier 12.2% forecast for 2015, and the number of Russians living below the poverty threshold will grow to 12.4% from 11% in 2014 on real wage cuts, the Economic Development Ministry said in its adjusted forecast Tuesday.

“The main risks for persistently high inflation are still in place and linked to a further weakening of the ruble in volatile trade. In this context, the possibility of a lower supply and of market misbalance is growing which will push prices higher,” the ministry said.

The average inflation will stand at 15.8%, and as the result the real wage will fall 9.6% in 2015. The state employees’ salaries will be most vulnerable amid budget cuts, the ministry said.

Under the new estimate, inflation will peak at the end of March or early April at 17–17.5% annually, the ministry said. The consumer prices will grow fast in January–June, pushed higher by the ruble devaluation. Russia’s food imports embargo will also contribute to the situation, the ministry said.

Food and tobacco output will increase by 2.3% in 2015, partially because local farmers have begun to replace imports which are now prohibited, the ministry said. Dairy and meat output will see the most noticeable growth with meat output rising 6.6%, cheese output growing 3%, butter production 2% and fish production 1.7%.

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