Inflation Up 0.6%, CPI 1.4% in August

According to the State Statistics Committee, in August the inflation rate grew by 0.6% mom and reached 6.2% since the beginning of the year. The main CPI driver continued to be food products (+0.9% mom), in which the highest growth occurred in food oils (+13.5% mom). PPI rose 1.4% mom in August, slightly down from the 1.7% mom rise in July and up 14.5% YTD. Polina Khomenko: As we predicted, consumer price growth has slowed on the back of the harvest campaign and government efforts to curb inflation in the runup to elections. We see benign CPI growth through year end (1% mom on average) and stand by our 10.5% forecast for 2007.