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Russian shoppers are feeling the pressure as inflation remains high.
Economy Europe

Russian shoppers are feeling the pressure as inflation remains high.

The produce and meat sections at supermarkets in Moscow are well-stocked, but numerous customers are disheartened by the high prices caused by inflation.

The Central Bank of Russia has increased its primary interest rate on four occasions this year in an attempt to manage inflation and stabilize the exchange rate of the ruble. This is in response to the impact of Russia’s military involvement in Ukraine and the subsequent sanctions imposed by Western countries.

The most recent increase in the rate was to 15%, which was twice the rate at the beginning of the year. The bank expressed worry about inflation, which was growing at a yearly rate of approximately 12%. The bank’s current prediction is that inflation for both this year and next year will be around 7.5%.

While the stated percentage is significant, it is possible that it is not accurately representing the situation.

Roxana Gheltkova, a shopper at a Moscow supermarket, stated that the prices of meat, staple products (such as dairy, fruits, and vegetables), and sausages have likely increased by 25% when discussing percentages. She also mentioned her husband’s love for sausage and expressed surprise at the sudden price increases.

When inquired about whether her retirement income covers her expenses for food, Lilya Tsarkova, a customer, responded by saying that it is not enough and she receives assistance from her children.

The elderly person, aged 70, expressed that they would not be able to cover expenses for rent and food without help.

According to data published by the Russian state statistical service Rosstat on November 1, there has been a significant increase in the prices of certain food items in comparison to 2022 – specifically, a 74% increase for cabbage, a 72% increase for oranges, and a 47% increase for cucumbers.

The budget for 2024-26 has been approved by the Russian parliament, with a significant portion allocated towards defense spending. According to Maxim Blant, an economic analyst from Latvia, this suggests that prices will continue to skyrocket.

He stated to The Associated Press that it is extremely challenging to address the problem of inflation in situations where the military-industrial complex has access to boundless funding and is granted all of their requests, causing their portion of the economy to rapidly expand.

The recent increases in the central bank’s interest rates have slightly decreased the devaluation of the ruble against the U.S. dollar, with the rate currently at approximately 88 rubles per dollar compared to over 100 previously. However, this is still significantly higher than the summer of 2022 when the rate was around 60 rubles per dollar.

This maintains elevated prices for imported goods, despite a decrease in import options caused by sanctions from Western countries.