In February, the consumer price index (hereinafter - the CPI) increased only by 0.2%. The annual rate of consumer inflation declined to 3.0% (the lowest figure recorded since March 2003). The seasonally adjusted CPI has remained negative for the sixth consecutive month (0.1% in February).
The core CPI continued to decelerate to 6.1% year-on-year (the core CPI rose by 0.1% on a month-on-month basis). It was achieved due to the discrete monetary and fiscal policy.
Under the influence of secondary effects of a fall in prices for raw foods (5.1% over the year), prices for deeply processed foodstuffs, which are included in the core CPI, declined to 9.6% over the year. The annual growth of the narrow core CPI slowed down to 1.8%.
In February 2012, inflation was determined by its non-core component, which stood at 0.4% (contribution to the change in the CPI – 0.2 p.p.)
The annual change in the non-core CPI has reached negative value (-0.9%) for the first time in 9 years. The key factor behind it was an ongoing fall in prices for raw foods (5.1% over the last twelve months) on account of last year’s bumper crop.
Rises for administratively-regulated prices slowed down to 4.9% on an annualized basis (0.3% in February), contributing 0.9 p. p. to the CPI (0.1 p.p. over a month).
Fuel prices grew at a faster pace (by 18.9%) than other components of the non-core inflation over the last twelve months. However, fuel price increases slowed down for the fourth successive month.
The slowing in economic activity entails a decline in the annual growth rates of prices for products of basic export-oriented industries and brings the producer price index growth (hereinafter - the PPI) down to 7.5% on an annualized basis. The PPI increased by 0.8% in February, which can be attributed to a rise in prices for production and distribution of electric power, gas, and water (1.6%) and processing industry (0.4%), contributing 0.3 p. p. to the change in the PPI. The largest contribution (1.2 p. p.) to the annual change in the PPI was made by price rises for foodstuffs, beverages and tobacco goods.
The complete wording of the analytical note has been posted on the official website.