FILE PHOTO: Employees are seen next to lead-and-zinc ore crusher at the Novoangarsky lead and zinc ore dressing plant on a former riverbed of Angara river near the Siberian settlement of Novoangars, Russia, August 17, 2016. Picture taken August 17, 2016.
(Reuters) -Costs in Russia’s manufacturing sector rose for the second month running in March, data from the state statistics service Rosstat showed on Wednesday, driven by a sharp jump in the cost of mining, extraction and some petroleum product production.
The producer prices index (PPI), a measure of costs in the manufacturing sector, increased 0.9% in March. In February, the index rose for the first time month-on-month since April 2022.
On an annual basis, the PPI fell 10.7% in March, Rosstat said. In the same month last year, the index had risen 26.9% year on year.
Prices for ores and concentrates in some mineral extraction doubled in March, compared with February, while certain types of petroleum products for manufacturing industries saw significant increases, the data showed.
A separate set of Rosstat data showed that consumer prices rose at a slower pace in the week to April 17, increasing by 0.04% after a rise of 0.11% in the previous week.
Since the start of the year, consumer prices have risen 1.88%, a slower pace than in the same period of 2022, Rosstat said. Prices soared in the weeks after Russia sent tens of thousands of troops into Ukraine in February last year.
Russia’s economy ministry said inflation was running at 2.82% on an annual basis as of April 17, down from 3.15% a week ago.
The central bank has become more hawkish this year, warning of the inflationary risks a widening budget deficit, weaker rouble and labour shortages pose.
“Despite a gradual recovery in demand and improved consumer sentiment, price growth remains moderate,” the bank said on Tuesday. “At the same time, inflation expectations remain elevated and pro-inflationary risks still prevail over disinflationary ones.”
The bank is next due to set interest rates on April 28.
Russia’s annual inflation rate in 2022 was 11.9%, almost three times the government’s official 4% target. The central bank forecasts inflation will be 5-7% this year, falling to 4% in 2024.