The annual dynamics of food prices in Chechnya is falling for the eighth month in a row. In December it was 14.9% against 15.5% in November. The increase in the prices of dairy products, cereals and sweets slowed down particularly markedly.
By increasing the beet harvest, it was possible to increase sugar production. The costs of confectionery producers decreased, as a result of which the prices of biscuits and sweets grew more slowly.
The expansion of the sown area and favorable weather allowed Russian farmers to collect a record harvest of grain. This worked to the advantage of processors: their costs fell, so the increase in flour and cereal prices slowed down.
“Supplier regions have increased raw milk production and market supply has increased. As a result, the price growth rate of cottage cheese, cream, drinking and condensed milk, sour milk products and butter slowed down,” said Isa Tamaev, head of the Bank of Russia branch in the Chechen Republic.
A slight acceleration of inflation was observed in the non-food market. This was due to an increase in sales in the housing market, which spurred demand for goods for home renovation and renovation. As a result, the annual increase in furniture prices accelerated. The inhabitants of the region also often bought household appliances and kitchen equipment, which resulted in an increase in the price dynamics of refrigerators, washing machines, electric kettles and irons on an annual basis.
In addition, inflation in the region, which amounted to 12.9% in December, was affected by the shift in the indexation of housing and communal services tariffs from July 2023 to December last year.
According to the forecast of the Bank of Russia, inflation in the country will continue to fall and may drop below 4% for a short time in spring 2023 due to the base effect. Taking into account the current monetary policy, annual inflation will amount to 5-7% in 2023 and will return to 4% in 2024.
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