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(MENAFN) The latest data from the Federal State Statistics Service show that Russia's consumer inflation rate continued its upward trend in June, accelerating for the sixth consecutive month and reaching its highest level since February 2023. Year-on-year inflation rose to 8.59 percent in June, from 8.3 percent in May, reflecting ongoing pressures in various sectors of the economy.

Food prices, a key component of consumer spending, saw a significant increase. Food inflation rose sharply to 9.81 percent last month. At the same time, services sector inflation also rose to 8.79 percent, indicating broad-based cost pressures affecting both households and businesses.

Despite these annual increases, monthly inflation declined slightly in June to 0.6 percent, compared with 0.7 percent in May. This slowdown in monthly inflation was primarily due to more stable prices in the food and services sectors during the period.

The Russian Central Bank decided to keep its key interest rate unchanged at 16 percent for the fifth consecutive meeting at its last meeting in June. This decision underscores the central bank's cautious approach to managing inflation expectations and stabilizing the economy in the face of external economic challenges and geopolitical uncertainties.

Looking ahead, the Central Bank forecasts that annual inflation will gradually decline, returning to the target level by 2025 and then stabilizing at around 4 percent. This forward-looking strategy reflects efforts to balance economic growth and inflation control, thereby ensuring sustainable economic stability in Russia in the medium term.

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