Russia inflation hits decade high after drought: statistics

6th September 2010, Comments 0 comments

Russian monthly inflation in August hit its highest level for a decade as the effects of the country's worst ever drought ramped up prices, statistics showed Monday.

Inflation in Russia was 0.6 percent for August 2010, significantly higher than before the drought when inflation held at 0.4 percent for June and July, the state statistics office said.

The Interfax news agency, citing official data, said the record jump in prices -- particularly of basic food stuffs such as buckwheat, flour and milk -- was the highest in the month since August 2000, when Russia saw inflation of 1.0 percent.

Most alarmingly, the price of Russian staple buckwheat, enjoyed by generations for breakfast or as an accompaniment to meat, rose an unprecedented 31.4 percent in 45 Russian regions, statistics showed.

Flour prices rose a sharp 10.8 percent, sending the price of bread -- a key component of the Russian diet that is consumed with almost every meal -- soaring by 2.1-2.4 percent. Milk prices rose 4.1 percent.

Overall, inflation was at 5.4 percent for the first eight months of this year, compared to 8.1 percent for the same period in crisis-hit 2009.

The drought, caused by the hottest summer in Russia on record, has destroyed one quarter of the country's crops and prompted the government to slap a highly controversial ban on grain exports to protect domestic supplies.

© 2010 AFP

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