The inflation in Russia may shed to 5 percent in the following three years, Finance Minister Alexey Kudrin forecasted.
Photo: Grigory Tambulov
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Russia’s Inflation to Go Dn to 5 Percent in 3 Years
The inflation in Russia will shed to 6 percent or perhaps 5 percent in the following three years, Finance Minister Alexey Kudrin said during the 16th World Bank Congress in St. Petersburg. The decline in inflation is slowed down by increasing state spending.
CBR forecasts the 8-percent inflation for 2007; the prices grew 4.7 percent in the first five months of this year and stepped up 7.8 percent if taken from May 2006 to May 2007.
By investing the money of Stabilization Fund in economy, Russia narrows chances for its advance, Kudrin pointed out. “Our closest neighbors have more material capital inflow and sterilize it more intensely; that’s why they have the inflation of 2 percent,” the minister said, pointing out that Russia is yet unable to boast of good financial indicators.
According to CBR CEO Sergey Ignatiev, the net inflow of foreign capital to Russia reached $60 billion in the first five months of this year, This inflow surged gold/foreign exchange reserves of the country that widened by $100 billion in five months. The inflow will go down a bit, Ignatiev forecasted.
The huge inflow registered on June 1, 2007 could be attributed to auctioned assets of Yukos and to IPOs of VTB and Sberbank. “We expect weaker inflow in the nearest months and some slowdown in growth of gold/fx reserves and money supply,” said the CBR chief.
The 2006 net inflow of foreign capital to Russia amounted to $41.6 billion.
www.kommersant.com
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