FX.co ★ Russia Inflation Refrains from Declining Sharply

The headline inflation rate in Russia eased to 5.9% in February 2025 from 6.0% in January, coming in slightly above market expectations of 5.7% and underscoring persistent inflationary pressures in the Russian economy. The reading was broadly in line with guidance from the Bank of Russia, which had warned that inflation would stay elevated early in the year due to higher VAT and excise taxes. However, it temporarily calls into question the central bank’s forecast that headline inflation would remain in the 4.5%–5.5% range for the year. Service prices climbed sharply (9.9%), offsetting more moderate increases in food (5.4%) and non-food products (3.2%). On a monthly basis, consumer prices rose 0.7%.