MOSCOW (Reuters) – Russian companies surveyed by the central bank expect inflation in 2025 of 10.7%, more than double the official forecast, and named labour shortages as one of the main factors stopping them expanding production, the central bank said on Friday.
It held interest rates at 21% in December, surprising the market which had been bracing for another hike to as high as 23%. Inflation in 2024 was the fourth highest rate in the last 15 years at 9.52%, compared to 7.42% in 2023 and well above the bank’s 4% target.
The central bank’s survey of almost 15,000 companies showed that businesses, when forming plans for 2025, accounted for annual inflation of 10.7% on average.
Credit conditions remained tight in January, the report said, and the central bank said it would take elevated inflation expectations into account when it next meets to set rates on Feb. 14.
Companies’ expectations for the change in prices of their goods over the coming three months remained steady in January after rising for four consecutive months, the survey showed.
The central bank also said that its business climate indicator was at its lowest monthly level in January for two years.