Talking Trends: structural transformation of economy
In March, unprecedented sanctions started to affect a number of Russian industries causing disruptions in production and logistics chains. To adapt to the new conditions, the Russian economy will need to go through a structural transformation.
Inflation sped up dramatically in March, which resulted from the adjustment of prices to the changed external conditions, as well as the increase in households’ inflation expectations amid difficulties with supplies of certain goods. After the surge in March, the current price growth rate is going down, while still exceeding the target. Considering the monetary policy pursued, inflation is expected to slow down steadily in 2023. This will create conditions for returning inflation to 4% in the medium term.
More details are presented in Talking Trends, a Bank of Russia bulletin.