While Russia is rejoicing at the fall in inflation rates, the EU believes that everything is going according to plan and the Russian economy has begun its decline..

Thus, in May, annual inflation in Russia slowed down for the first time since February.. So, from May 28 to June 3, according to the report of the Ministry of Economy, its level " And if in the April forecast the Central Bank of the Republic of Belarus expected inflation for the year at the level of 18-23%, now the Central Bank predicts that by the end of the year it will be 18-20%.

17% is a lot or a little?

As the Russian Channel One recently reported, amid record inflation in the EU, sanctions against the Russian Federation are having the opposite effect: “Due to record inflation - in April it reached 7.5%, five times more than last year, residents.

However, inflation in the eurozone countries in April amounted to 7.5%, Eurostat reported. Although a year ago, in April 2021, it was several times lower - 1.6%. However, there is only one country in the Eurozone that had higher inflation in April than Russia, and that is Estonia.. Prices have risen by 19%. By the way, forecasts for inflation in the eurozone also do not promise a catastrophe for the EU.. The European Commission expects inflation at 6.1% in 2022, and then up to 2.7% in 2023.

Important point.

Inflation is not the worst. And her RF slowdown won't help. In the Russian Federation, production and the economy are declining (when no one buys anything, therefore prices do not rise). On June 7, the World Bank published a forecast according to which the Russian economy will fall by 8.9% this year and by 2% in 2023.. As the WB experts explained, the events in Ukraine undermine “business activity, investment, and trade in the short term, while pent-up demand is fading away, and fiscal and monetary stimulus is curtailing”.

At the same time, experts suggested that the fall could be even more significant if European governments continue to take actions to reduce the volume of imports of Russian energy resources.. And yesterday it became known that the European Union signed an agreement with Israel and Egypt on the supply of Israeli gas to the EU.

What will happen to inflation in the Russian Federation next?

There are two scenarios that experts are talking about:.

First option. Second wave of inflation. Since the stocks of imported goods are running out, and new deliveries will already go through parallel imports, that is, they will be supplied not by manufacturers, but by various intermediaries. According to various estimates, prices can rise by 20-60%.

“We do not see a recovery in import volumes.

A shortage may arise for a number of goods, prices for them will rise, and we can get inflation acceleration for them,” predicts Alexei Devyatov, chief economist at Uralsib..

Second option. Inflation will fall, and with it the economy will fall.

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What's better?

Any of the above scenarios leads to a fall in the economy.. It's a question of " However, President Vladimir Putin of the Russian Federation recently promised that in 10 years it would be better to live in Russia: “And this should eventually lead to an improvement in the quality of life.”.