To quote him, "inflation could be kept at 8.5%, but it also possible within the corridor of 8.5-10%. Everything will depend on the summer months."
Formerly, Russia's finance ministry presented a similar forecast. The report made public on March 5 projected this year's inflation at the level of 10%, whereas the official forecast written into the federal budget gave the figure of 8.5%.
German Gref told journalists that his ministry, together with the finance ministry and the Central Bank, submitted proposals to the government on how to curb the inflation this year. "This is a whole set of measures, including those of anti-monopoly regulation," the minister said.
In his words, the Federal Anti-Monopoly Service (FAS) "worked well with the oil companies" and won four court cases on the ungrounded rise in petroleum product prices. Now the FAS should prevent a rise in metal prices.
German Gref also said that, in order to avert a rise in beef and pork prices, the government was considering the proposal to reduce import duties on meat imported over and above the quotas set by the government. It was also looking into the possibility to cut these duties from 60% to 40% of the customs value of product.
The minister pointed to the need to avert an increase in state non-interest expenditures.
Speaking of measures of the monetary policy, German Gref said that the strengthening of an effective ruble exchange rate was possible within 7-8%. It is also necessary to stop an increase in prices for services of the housing and utilities complex, he noted. "We have sent telegrams to the regions asking them to try to prevent the further rise in prices."
Experts approved the adjustment of the inflation forecast for 2005.
"This is most sensible," said Alexander Shokin, chairman of the coordinating council of the Entrepreneurial Unions.
In his opinion, the adjustment of forecasts on key macroeconomic indicators (not only on inflation, but also on oil prices) will make it possible to draft a more realistic budget for the year 2006.
Vladislav Reznik, member of the parliamentary committee for lending organizations and financial markets, believes that the higher forecast for the inflation level in 2005 (10%) is connected with an increase in federal budget spending.
In an interview to RIA Novosti, he said that "inflation is stimulated by large budget expenses and the absence of tough control over the budget." In his opinion, an increase in budget spending on cash payments replacing social benefits will be a major factor causing a rise in inflation.
"The monetization of benefits needs more funds than it was planned to allocate," he noted.
In Vladislav Reznik's opinion, the preservation of quotas on [imports of] of some foodstuffs, including beef and poultry meat, also contributes to the rise in inflation. "Last year, inflation rose by some 1.5-2% for this reason," he said.
Replying to RIA Novosti's questions, experts of Russian investment companies expressed the opinion that the forecasted 10% inflation figure was more realistic but at the same time more difficult to achieve.
