Russia Inflation Preview: Inflation Will Slightly Decrease to 5.8% in April
Bottom Line: We expect Russian inflation to continue its decreasing pattern moderately in April owing to lagged impacts of previous aggressive monetary tightening and relative resilience of RUB. April inflation figures will be announced on May 15, and we foresee y/y prices to hover around 5.8%. Despite Central Bank of Russia (CBR) predicts annual inflation to decline to 4.5–5.5% in 2026, our 2026 average headline inflation projection stays at 5.9% due to inflationary risks.
Figure 1: CPI, Core Inflation (YoY, % Change) and Policy Rate (%), January 2015 – March 2026
Source: Continuum Economics
After annual inflation edged down to 5.9% y/y in March, we expect the decreasing trend to continue moderately in April thanks to lagged impacts of previous aggressive monetary tightening, relative resilience of RUB and decreasing core inflation so far in 2026. We foresee y/y prices to hover around 5.8% y/y in April. April inflation figures will be announced on May 15.
Recent data from the Ministry of Economic Development shows Russian annual inflation cooled off to 5.6% in early May, down from 5.77% in mid-April, signaling a steady cooling-off period.
Speaking about the inflation trajectory, Central Bank of Russia (CBR) governor Nabiullina recently said that "Regarding achieving the 4% target, we have not abandoned our intention this year to draw a line after five years of high inflation. (…) It is precisely underlying inflation that matters to us, will be around 4% already in the second half of this year. "
The CBR projects annual inflation will decline to 4.5–5.5% in 2026, aiming for a return to its 4% target by 2027. However, we believe meeting this target range will be challenging in 2026. Persistent sanctions, the fallout from the conflict in Iran, sustained military spending and excise taxes are likely to prolong the disinflationary process beyond the CBR's expectations. We think pro-inflationary risks still prevail over disinflationary ones in the mid-term horizon.
Our CPI forecasts stand at 5.9% and 5.2% in 2026 and 2027, respectively as we expect inflation will continue to soften as previous tight monetary policy affect bank lending and private consumption. We believe a peace deal in Ukraine remains the real key to ease pressure on inflation and alleviate demand-supply imbalances in Russia.