November 17, 2014 / 7:11 PM / 5 years ago

Russia's economy minister sees inflation rising above 9 percent

Russian Economy Minister Alexei Ulyukayev looks on before a meeting of the presidential state council at the Kremlin in Moscow, September 18, 2014. REUTERS/Maxim Shemetov

MOSCOW (Reuters) - Russian inflation will exceed forecasts to reach 9 percent by year end and rise further in early 2015 because of the rouble’s weakness, Economy Minister Alexei Ulyukayev told radio Ekho Moskvy on Monday.

The rouble has weakened some 30 percent versus the dollar this year, as Western sanctions over the Ukraine crisis have made it harder for banks and companies to refinance foreign currency debts and as tumbling oil prices have hurt government revenue.

“Inflation for 2014 would be much higher than any forecasts, that’s because it depends on (rouble) devaluation,” Ulyukayev said.

Last week, the Russian central bank increased its inflation forecast for this year to 8.2-8.4 percent from 7.5 percent. For 2015, it saw inflation abating to 6.2-6.4 percent — still higher than previous 4.5-5.0 percent estimates.

“By the end of the first quarter (of 2015) inflation will stand by around 3.5 (percentage points) higher than we expected. And we expected it at 6 percent... By the end of this year it will reach 9 percent,” the minister said.

Reporting by Vladimir Soldatkin; Editing by Ruth Pitchford

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