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Pivotal Weekly CPI Print Ahead as CBR Decision Hangs in the Balance

RUSSIA
  • Pivotal weekly CPI print for Russia (4pm GMT) ahead of Friday's CBR meeting - many saying could tip the scales either way between a cut or hold.
  • Downside surprise (<4.3% YoY) could see more people assessing recent food, loan growth & FX induced CPI spike as transitory
  • and estimates for 4.9% headline print in Feb as overcooked
  • providing space for one final 25bp cut at this meeting.
  • Upside surprise (>4.3% YoY) reinforces broader consensus for a hold at this meeting following the headline overshoot in November at 4.4% YoY.
  • Should culminate in a more cautious CBR with Nabuillina concerned over expectations not being well anchored.
  • Possible revisit to 25bp cut in 1Q21 or 2H21 when inflation expectations are likely to moderate on persistent output/consumption gap.
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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