Features of modern anti-inflationary policy in the Russian Federation

Kovalev Vladislav Alekseevich ORCID: 0009-0000-2110-6400 student; Department of Public Finance; Financial University under the Government of the Russian Federation 49/2 Leningradsky ave., Moscow, 125167, Russia kovalevdocs@mail.ru Other publications by this author

Dorofeev Mikhail Lvovitch ORCID: 0000-0002-2829-9900 PhD in Economics Associate Professor; Department of Public Finance; Financial University under the Government of the Russian Federation 49/2 Leningradsky ave., Moscow, 125167, Russia dorofeevml@yandex.ru

Introduction. The relevance of the work is due to the need to assess the effectiveness and expediency of the anti-inflationary policy in the Russian Federation in the context of maintaining high growth rates in the consumer price index and increasing the key rate of the Bank of Russia to an unprecedented high level of 21.00% in November 2024. The 4.0% inflation target was not achieved as a result of repeated successive increases in the key rate, which began in August 2023, and the forecast year for achieving the inflation target shifted from 2024 to 2026. The Bank of Russia's long-term implementation of a tight monetary policy is accompanied by criticism and concerns about curbing Russia's economic growth and structural restructuring of its economy, damaging certain sectors of the economy and the imminent onset of recession or stagflation. It becomes necessary to identify the main factors of inflation in Russia in the modern period, the reasons for the low slowdown in price growth and the likelihood of achieving inflation targets in the coming years. The negative consequences of sustained high inflation, such as disruption of economic processes, threats to social stability, lower living standards, high cost of debt financing, and reduction in national income, have been repeatedly emphasized by researchers. ^{[1] [2] [3]}. The purpose of the work is to identify the main features and assess the expediency of the current anti-inflationary policy. To achieve this goal, we identify the main determinants of price growth in the Russian economy and methods to counter it, characterize the impact of fiscal policy, autonomous demand and non-monetary factors on the effectiveness of anti-inflationary policies, and assess the consequences of lowering the key interest rate. In the study, we use statistical and analytical materials from the regulator on monetary policy, compare the results of research on inflationary processes, and analyze indicators of unemployment, wages, preferential loans, and fiscal policy. It should be noted that despite the presence in the literature of comments on the static nature of the target, the justification for the establishment by the Bank of Russia of its specific value and the discovery of the negative impact of inflation targeting on economic growth in Russia ^[4], our work does not address the issues of setting a target inflation rate.

Factors of inflation in the Russian Federation. Based on the results of visualization of inflation dynamics over the past 10 years (Figure 1), it is possible to distinguish three periods of both progressive and sharp inflation growth, which can trivially be explained by output gaps: due to external constraints in 2015, in 2021, the realization of deferred aggregate demand after the COVID–19 pandemic and not having had time since Supply will recover at the same rate, with an increase in external constraints and ongoing business adaptation and changes in the structure of the economy, as well as the restoration and restructuring of trade relations starting in 2023.

Figure 1 – Annual inflation, % yoy

Source: built by the authors according to the data of the Bank of Russia. URL: https://www.cbr.ru/hd_base/infl.

Among the factors of inflation, conditionally divided into internal and external in Table 1, supply and demand shocks cause an output gap, an unobservable calculated value that reflects the deviation of potential GDP from actual GDP. A positive output gap, which signals, among other things, that aggregate demand exceeds aggregate supply, implies an increase in marginal costs, which have a direct pro-inflationary effect on the economy. Despite the presence of a negative output gap since the beginning of the introduction of external restrictions in 2022, after overcoming the effects of the primary shock and the beginning of adaptation simultaneously from aggregate supply and demand, there is a clear trend towards an increase in the positive output gap: actual output exceeds potential, labor resources and production facilities are maximally loaded to meet aggregate demand, the economy is overheating, the indicator of which is inflation.

Table 1 – Factors of inflation

Source: compiled by the authors.

Indeed, according to the econometric assessment of the components of the deviation of inflation from the target, if the greatest pro-inflationary effect in the period from 2021 to the first half of 2023 was exerted by restrictions on aggregate supply and the ongoing macroeconomic policy in terms of a significant increase in government spending, then in the second half of 2023 the contribution to the deviation of aggregate demand, the inability to meet which became the main factor of inflation in the first half of 2024 ^[5]. Despite the restrictions imposed, which were supposed to reduce the output potential in the Russian economy, and the lack of prerequisites for a significant increase in production factors, in 2023-2024, the Russian economy as a whole demonstrated high growth rates (3.6% in 2023, 5.4% and 4.1% in the first and second quarters of 2024, respectively), which were accompanied by pro-inflationary risks: record workload of industrial enterprises, shortage of the required number of qualified workers, increased competition for which, in order to respond to increased consumer and investment demand, contributed to such an increase in wages and real disposable incomes of the population, which outstripped the growth in production productivity.

The limited ability to increase output potential is demonstrated by the data from the Bank of Russia survey on the state of production facilities and the sufficiency of labor resources: as of October 2024, 60% of the surveyed companies had free production capacity, while more than a third of them had outdated or low-productivity (according to the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/166814/analytic_note_20241030_dip.pdf ), despite the increase in investment activity of industrial enterprises in 2023. Certain industrial sectors (metal products, transportation, electrical equipment, repair and installation of equipment) are on the verge of a possible increase in output without additional investments in fixed assets or have already exceeded it. At the same time, restrictions are most pronounced for companies that need import substitution due to sanctions and meeting high demand from the state – updating or expanding their production capacities is difficult in the short term, and increasing output through additional load will lead to an increase in marginal costs, and consequently prices.

The possibilities of additional capacity utilization due to additional labor and the implementation of the most effective structural changes in the Russian economy are obviously limited by the size of the labor force, its structure and the gender and age pyramid. With the change in the structure of the economy, which has begun rapidly and is complemented by a decrease in labor migration, the effects of the pandemic and emigration from Russia, it is difficult in the short term to reorient part of the workforce to those industries that have faced most of the increase in demand and previously had a low rate of renewal of the production base and expansion of labor resources. By the end of 2023, 83% of enterprises in all types of activities noted a shortage of workers. This problem is almost twice as common as the lack of capacity expansion, and the need to overcome the shortage requires manufacturers to raise wages to lure employees from other organizations or industries (according to surveys by the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/166814/analytic_note_20241030_dip.pdf).

Increased competition for workers and high demand for them led to an unprecedented gap between labor supply and demand and the rate of decline in the unemployment rate – in June 2024, it dropped to 2.4% (Figure 2), while estimates of the NAIRU (non-accelerating inflation rate of unemployment) in Russia converge to the level of 4.00%, with a deviation of by 1.6 percentage points (according to ACRA. URL: https://www.acra-ratings.ru/upload/iblock/86f/b26rsfsf39ghajs3lr0w67tiwhtmes10/20240305_RRFDK.pdf).

Figure 2 – Unemployment rate, %

Source: compiled by the authors according to Rosstat data. URL: https://rosstat.gov.ru/labour_force.

The accelerated growth of wages and the total wage fund of organizations (Figure 3) is reflected in the cost of goods, works and services, their selling prices, and subsequently in rising prices, and hinder the implementation of plans to increase output, both with and without additional investments, while the driver of the impact of such The remaining high demand serves as a constraint on the inflation rate.

Figure 3 – The wage fund of organizations

Source: compiled by the authors according to EMISS data. URL: https://fedstat.ru/indicator/57849.

The effect of the exchange rate shift – changes in inflation as a result of the influence of exchange rate dynamics on the prices of imported goods and demand for exported ones - was estimated at 1 percentage point in 2018, while it is noted that the contribution of exchange rate changes to prices in Russia was maximal in 2015 and did not reach the previous high values ^[6]. Currently, given that the transfer effect is considered non-linear in the short term (the weakening of the ruble exchange rate has a stronger effect on changes in inflation than its strengthening), exchange rate dynamics primarily manifests itself in changes in inflation expectations ^[6], causing an additional surge in demand and price increases as a reaction to it, however, we assume that that such short-term fluctuations in demand are not a particularly significant object that should be influenced by monetary policy in the current environment. Speaking about the import of inflation from Russia's potential main trading partners, we note that in 2022-2024, the inflation rate was lower than in the Russian Federation, Belarus, Brazil, China, India and all developed countries, and higher in Turkey and Kazakhstan (according to the IMF. URL: https://www.imf.org/external/datamapper/PCPIPCH@WEO/OEMDC/ADVEC/WEOWORLD).

Effectiveness of anti-inflationary policy. We note the impact on the implementation of anti–inflationary policies and the growth of aggregate demand due to the budget impulse, characterized by a significant increase in government spending in general (Figure - 4) and the active application of government support measures, subsidies, including interest rates ^[7]. Fiscal expansion in the post-pandemic period was continued by countercyclical and stimulating fiscal policy in the first half of 2022, which is still being implemented today ^[8]. Empirical estimates have confirmed the existence of a positive relationship between an increase in government support, an increase in budget deficits, and rising prices in developing countries ^[9], while this relationship is stronger during periods of high than low inflation ^[10].

Figure 4 – Expenses of the consolidated budget of the Russian Federation in relation to GDP, %

Source: compiled by the authors according to the Russian Ministry of Finance. URL: https://minfin.gov.ru/ru/statistics/conbud.

The researchers note that in the sectors of the economy where producers received government support, there was a rapid and high increase in the consumer price index over a period equivalent to ~ 1-5 quarters. Prices stabilize at a higher level than before receiving support, after ~ 10-15 quarters after spending. At the same time, the rate of transfer of state support measures announced in the Message of the President of the Russian Federation to the Federal Assembly in 2024 to prices will increase in comparison with the structure of budget revenues and expenditures until 2025, while slowing the disinflationary effect of increasing the tax burden (URL: https://www.cbr.ru/Content/Document/File/165956/analytic_note_20240901_dip.pdf ). Thus, simultaneously with the application of anti-inflationary monetary policy measures that have a short-term impact on the economy, fiscal support is being implemented, causing prices to rise without a significant increase in output, which creates a situation of complete misdirection between the two policies and leads to the need for additional tightening of monetary policy and lengthening its period.

Provided that fiscal policy stimulates aggregate demand more strongly than an increase in output, an increase in the key rate should force the Government to reduce public spending and budget discipline, primarily through the cost of government borrowing and debt. However, public debt servicing costs remain low (in 2027 they will reach ~ 1.45% of GDP) (Federal Law No. 419-FZ of 11/30/2024), and the federal budget deficit is partially, but actively, covered through the use of funds from the National Welfare Fund (NWF), which allows maintaining the level of public debt and spending on it. the service is at a relatively safe level ^[8]. The issue of federal loan bonds (OFZ) with a floating coupon (for example, in December 2024 in the amount of 1.9 trillion rubles, the demand for which was almost 2 times higher than the supply (Bank of Russia. URL: https://www.cbr.ru/Collection/Collection/File/54959/razv_bs_24_11.pdf )), also allows fiscal policy to be conducted more independently from monetary policy. Sequestration of budget expenditures of the budgetary system, primarily the federal budget, is not possible due to the high priority of spending on national defense, security and social policy, provided that in most countries significant fiscal consolidation is carried out after the application of fiscal stimulus measures ^[11]. Thus, the second most influential pro-inflationary factor is weakly sensitive to the tightening of monetary policy, while fiscal and monetary policy measures have counteracting effects, their directions contradict each other ^{[12] [13]}.

Concessional lending with subsidized interest rates also reduces the effectiveness of the anti–inflationary policy. This is an example of autonomous demand that is weakly sensitive to the current monetary policy, in which an increase in the key rate, through an increase in the cost of subsidies, will be a signal only to the government. In the first half of 2024, the share of concessional loans in the total portfolio exceeded 15%, of which almost 10% were large-scale non-targeted concessional mortgage loans (according to the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/164702/on_2025(2026-2027).pdf).

At the same time, as the Bank of Russia notes, the imbalance between the rates of real estate construction and mortgage loans has led to an increase in housing prices, significantly outpacing even the rate of inflation, and noticeably distorted the monetary policy signals transmitted through the interest rate channel of the transmission mechanism. Thus, housing prices in the second quarter of 2023 increased 2.1 times in the primary market and 1.6 times in the secondary market compared to the second quarter of 2019 (Figure 5), which confirms the significant contribution of this segment of autonomous demand to the price index, inflation expectations, and the weakening of the key interest rate impact on demand. Despite the cancellation of the preferential mortgage in the summer of 2024, its effect, in our opinion, contributed to the failure to achieve the inflation target and prolong the period of key rate increases due to distortions in the transmission mechanism.

Figure 5 – Average price of 1 sq. m. of housing in the primary and secondary markets, RUB.

Source: built by the authors according to the EMISS data. URL: https://www.fedstat.ru/indicator/31452.

Non-monetary, one-time, and often administrative, inflation factors contribute to slowing down the achievement of the inflation target, the causes of which cannot be influenced by monetary policy: if such factors are prolonged, or they act co-directionally on a significant part of the consumer basket, they can have effects on inflationary expectations and stable inflation, despite the fact that the scope of action each of the factors individually can be quite narrow. In 2024-2025, among such factors, it is possible to identify the following:

1. increase in tariffs for housing and communal services - on average in Russia by 11.9% from July 2025 (Decree of the Government of the Russian Federation dated 11/15/2024 No. 3287-r);

2. The increase in the recycling fee is by 70-85% from October 2024 and by 10-20% annually until 2030 (Decree of the Government of the Russian Federation dated 09/13/2024 No. 1255);

3. Increase in import duties (Decree of the Government of the Russian Federation dated 07/19/2024 No. 984);

4. increase in rates on certain property and rental taxes (MET) for companies in certain raw materials industries, for example, the MET for gold of 78 thousand rubles (Federal Law No. 96-FZ of 04/22/2024);

5. Decisions taken on the introduction of excise taxes and their unscheduled indexation, for example, the expansion of the list of goods subject to excise duty from January 1, 2025 (Federal Law No. 176-FZ of 07/12/2024);

6. Expansion of the progressive scale of personal income tax (personal income tax) (Federal Law No. 176-FZ of 07/12/2024);

7. Increase in the threshold for the application of the simplified taxation system (USN) (Federal Law No. 176-FZ of 07/12/2024);

8. Increase in the corporate income tax rate from 20% to 25% from 2025 (Federal Law No. 176-FZ of 07/12/2024).

It should be noted that these factors will not only have a clearly inflationary effect as a result of the transfer of taxes, fees and duties to prices, but also are additional sources of revenue for the budgets of the budgetary system, which means they allow maintaining or increasing the current level of government spending with an acceptable level of public debt and the cost of servicing it, which means they make fiscal policy even less sensitive to the current monetary policy. In addition, the negative impact of increased personal and corporate tax rates on economic growth has been empirically proven. ^{[14] [15] [16]}, this creates the prerequisites for unjustifiably attributing a greater contribution of continued consistent inflation targeting to the slowdown in GDP growth in the Russian Federation.

According to the authors, a separate contribution to the slow cooling of consumer demand was made by the persistence of high uncertainty about the future socio-economic development of Russia and the political situation, which led not only to persistently high inflation expectations of consumers, but also to the presentation of expanded demand based not on the expectation of rising prices, but on the overall change in economic patterns. behavior in the last three years, complemented by increased short-sightedness of economic agents, an asymmetric perception of prices, and trust in less accurate sources ^[17].

The average annual key rate in 2024 reached a historically high level, although the gap between it and average annual inflation was higher in 2019-2020 (table 2).

Table 2 – Average annual inflation and key rate

Source: compiled by the authors according to the data of the Bank of Russia. URL: https://www.cbr.ru/hd_base/infl.

Note: the years of the full or closest achievement of the inflation target are highlighted with a color fill.

The Bank of Russia continues to use the key rate as the main and most transparent tool for achieving the target and cooling aggregate demand. Through the interest rate channel of monetary policy, it influences the largest number of decisions of economic entities, the adoption of which, in turn, creates aggregate demand and mediates price changes. Thus, the Bank of Russia's enterprise monitoring data show a continuous decline in estimated demand for goods, works and services from August to November 2024 (Figure 6), the Bank of Russia's business climate indicator decreased by 0.8 percentage points in December compared to November, and the growth of the Russian economy slowed (macroeconomic bulletin No. 8. URL: https://www.cbr.ru/ec_research/mb/bulletin_24-08 ), which indicates the results of the policy.

Figure 6 – Assessment of changes in demand for goods, works and services by cumulative total, points

Source: built by the authors according to the data of the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/135603/mp_survey_data.xlsx.

Note: negative ratings are indicated in orange, and positive ratings are indicated in blue.

Despite the fact that the Bank of Russia's macroprudential limits are aimed at reducing systemic risk in the economy and regulating the structure of unsecured lending, and are usually not used to respond to demand shocks ^[18], we do not rule out a disincentive effect on aggregate growth by successive tightening of limits in April–August 2024, as well as the planned application of macroprudential limits for mortgage loans and car loans: with a slight cooling of aggregate demand due to the interest rate channel, the possibility of obtaining it is administratively narrowed. As noted by Cecchetti S. and Kohler M., changes in banks' capital requirements show effectiveness in achieving price stability ^[19]. The impact of macroprudential policy and explicit credit restriction measures on price dynamics in Russia deserves a separate detailed study.

Assessment of the possibility of reducing the key rate and inflation. In the current situation, when inflation in Russia is driven by a demand shock stimulated by rising government spending, a reduction in the key interest rate will lead to a number of consequences outlined below (Figure 7).

Figure 7 – The consequences of lowering the key rate in the current environment, all other things being equal

Source: developed by the authors.

Firstly, lowering the key rate will not lead to a decrease in inflation expectations on the part of producers and consumers. Making such a decision if the inflation target is not reached or if there is no sustained reduction in it may be perceived by economic agents as the Bank of Russia's inability to achieve the target as a whole or abandoning the goal, which will only increase uncertainty in price growth expectations and contribute to the effect of fulfilling expectations ^[29].

Secondly, the propensity to save will decrease, and demand for cheaper loans will increase, which, along with a decrease in the ruble exchange rate (a 1% decrease in the ruble exchange rate led to an increase in inflation by 0.1 percentage points (according to the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/164702/on_2025 (2026-2027).pdf)) and cheaper domestic goods for export, will certainly lead to an even greater acceleration in the growth of aggregate demand.

Thirdly, manufacturers can immediately respond to an additional increase in demand by increasing prices, which will only move us further away from achieving the inflation target: an increase in the output gap of 1% leads to a change in annual inflation by 0.6 percentage points over four quarters (according to the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/164702/on_2025(2026-2027).pdf). In order to increase output, manufacturers will face the need to increase their workforce, which is extremely limited: there will be a need to hire or entice workers with an increase in wages, which will increase output costs and prices. Despite the fact that a reduction in the key rate will lead to greater availability of credit, the opportunities for raising capital on the stock market will remain severely limited ^[20], and making investments and purchasing fixed assets, manufacturing, commissioning and operating additional equipment will require additional workers, whose hiring, as we found out, will lead to higher costs. and price increases. When trying to increase output through intensive growth, producers will face the difficulty of increasing labor productivity due to limited access to production and educational technologies, such as employee training management and innovation management ^[21], and the presence of a natural limit to increasing labor intensity, which is also trapped in economic motivation: according to researchers, There is a wide stratum of workers in the labor market (51% of the sample) who are not ready to increase labor productivity even in exchange for additional remuneration, a quarter of workers have reached the ceiling in their work intensification and will not be able to increase it, and an increase in wages increases the likelihood of readiness to increase labor productivity by 19-20 percentage points ^[22]. At the same time, increasing labor productivity, which requires long-term R&D, is difficult to achieve in the short term in order to increase output in conditions of high inflation. Despite the fact that additional tax revenues from the budgets of the Russian budget system in 2025 can be used to finance knowledge-intensive measures to increase labor productivity and output in general, in Russia, with an increase in the share of tax revenues in GDP, the share of government spending on science decreases ^[23], which calls into question the possibility of rapid fiscal stimulation of growth performance.

Thus, a reduction in the key rate in the context of fundamental constraints in production factors will be exclusively inflationary in nature and will not be able to lead to such an increase in output that will satisfy overheated aggregate demand. This confirms the conclusions of N. A. Dinets about the impossibility of using transmission mechanism channels to stimulate production in the mass industrial sector ^[12]. The issues of increasing output should be considered from the perspective of fiscal policy and government incentives for innovation and productivity improvement: The President of the Russian Federation, paying attention to the coordination of actions between the Government of the Russian Federation and the Bank of Russia, noted that a systemic reduction in inflation should be carried out primarily through an increase in the supply of goods and services (official network resources of the President of Russia. URL: http://kremlin.ru/events/president/news/74935). The new structure of government spending will continue to influence output growth in Russia: despite the fact that their increase can increase the total supply, the shift in the structure of spending towards less productive ones, according to researchers, reduces the effect of GDP growth from an increase in government spending by 2.3 times, which is combined with an increase in the tax burden discussed above As a result, it can only have a negative effect on aggregate supply ^[24] and lead to price increases while maintaining the current high level of aggregate demand.

Despite the many estimates of the inflation rate and the possibility of achieving the target in the near future, we will highlight the most reliable data from the macroeconomic forecast of the Bank of Russia for 2025-2027. (Table 3), given its well-developed modeling apparatus and the widest access to macroeconomic data and the systematic underestimation of the projected inflation rate by professional analysts ^[25].

Table 3 – Parameters of scenario variants of the macroeconomic forecast of the Bank of Russia

Source: compiled by the authors based on the materials of the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/164702/on_2025(2026-2027).pdf.

In the basic scenario, as the most likely one, the global economy continues to develop within the framework of current trends and the absence of new shocks. By the end of 2025, inflation in the Russian Federation will be close to the target (4.5–5.0%) – it will reach it in 2026 and will remain near this level in 2027 (Table 4). The average annual key rate in 2025 will remain at 17.0–20.0% and decrease to 12.0 – 13.0% in 2026.

Table 4 – Inflation and key rate in scenario scenarios

Source: compiled by the authors based on the materials of the Bank of Russia. URL: https://www.cbr.ru/Content/Document/File/164702/on_2025(2026-2027).pdf.

Despite the fact that even the baseline scenario is not predetermined, relatively tight monetary policy will remain in 2025, and the degree to which the inflation target is achieved, all other things being equal, will depend on the implementation of additional external shocks and the inflationary situation in the world as a whole, as well as on the success of continued adaptation of production to new economic and logistical conditions. the realities and effectiveness of manufacturers' investment activity, which increased in 2023-2024.

Foreign guidelines and "codes" of best practices for changing the parameters of inflation targeting in the Russian Federation are currently, if not absent, then poorly applicable: it is advisable to take into account the experience of those countries that have at least a similar structure and composition of inflation. The economies of developing countries are too different from each other, and therefore it is difficult to create and apply a general theory in relation to them ^[26]. Firat M. And Hao O. The heterogeneity of inflation factors is emphasized: after the first quarter of 2022, the role of aggregate supply shocks has increased in the world (in Russia, the actual problem is aggregate demand), supply– and demand-driven inflation is decreasing in the United States and Asia, and aggregate supply-driven inflation remains stable in Europe ^[27]. In the United States, as of early 2023, harsh labor market conditions justified a lower proportion of inflation exceeding the target ^[28], when labor restrictions in Russia are the driver of a positive output gap, and consequently price increases.

Despite the recognition that conducting a tight monetary policy in conditions of fiscal dominance is erroneous ^[30], we agree with the need for an immediate response in the form of an increase in the key rate, accompanied by support for business activity ^[31]. The inflation targeting policy, on the one hand, was assessed as contributing to economic growth ^[32], on the other – as slowing down the average growth rate of output ^[33] and more effective in containing low inflation than in reducing high ^[34]. Under these conditions, we do not exclude the possibility of adjusting the anti-inflationary policy: including the debt level in the mandate of the Bank of Russia ^[35], switching to a mixed inflation targeting regime ^[36] and expanding the target range ^[4].

Conclusion. The increase in inflation in the Russian Federation at the present stage is due to a positive output gap and overheating of the economy: aggregate demand, supported by an increase in government spending, does not correspond to the size of the actual possible output. Production facilities are almost fully loaded, their renovation and expansion is difficult, and the supply of labor is extremely limited, which is why attracting additional workers leads to an increase in wages that does not correspond to the accompanying increase in output. An increase in the key rate remains an effective tool for anti-inflationary policy, but its effectiveness has been reduced as a result of prolonged use of large-scale subsidization of interest rates on concessional loans and weak sensitivity of fiscal policy to rate changes, which led to a longer period of high inflation and the key rate. We noted the possibility of applying macroprudential policy measures to counter price increases and the need to properly account for the contribution of administrative (one-time non-monetary) factors to inflation. As a result of the conducted research, we found out that in the short term there is no possibility of a significant increase in supply, including due to intensive and extensive expansion of production. Our assessment of the consequences of lowering the key rate has shown that such a measure will only contribute to further price increases: raising and maintaining the rate at a high level is justified. We assume that maintaining the current situation in the development of the global economy, curbing the growth of government spending, continuing tight monetary policy and the absence of external and internal socio-economic shocks, which, among other things, can affect the effectiveness of investments made earlier, are the main disinflationary factors in the next two years.

The article was prepared based on the results of research carried out at the expense of budgetary funds, on the state assignment of the Financial University under the Government of the Russian Federation.