Russian CPI spike creates case for another 50bp key rate hike

From think.ing.com

Russian CPI spiked by 0.5 percentage points to 6.0% year-on-year in May (Figure 1), which is a 4.5 year high. Last month's result exceeds the preliminary data by 0.1ppt and market expectations by 0.2ppt. The pick-up was assured not just by the lower base effect in the food segment, but also due to broad-based pressure in the non-food products segment, which contributed 2.1ppt to the overall CPI (Figure 2), the highest contribution in 4 years. The strongest price pressure was seen in construction material, related to the construction and renovation boom supported by the subsidised mortgage programme that has recently ... (full story)