CPI monitor: Shall we drive or fly?

Consumer inflation in Russia totaled 0.14% WoW over the July 4-10 period following 0.13% the previous week. The maintenance of inflation at a slightly elevated level was facilitated by goods with an import component, such as airline tickets and automobiles. Weakening of the ruble also apparently played a role. Inflation in June totaled 0.37% MoM compared with 0.31% in May. Inflationary pressure was formed by most commodities, while the slowdown in demand affected the dynamic in services. The ruble’s further dynamic may play a key role in determining the trajectory of key rate hikes by the CBR. As of now, scenarios for the CBR meeting on July 21 remain within a range of 25-75 bps.