Russia's inflation hits 8.7% in January-June

MOSCOW, June 2 (RIA Novosti) - Inflation in Russia totaled 8.7% in the first six months of this year, the federal statistics service said on Wednesday.

The service said inflation in June was 1.0%, the same figure as last year.

The finance and economics ministries have so far retained their inflation forecast of 10.5% for 2008 as they expect it to slow down in the second half of this year.

The Finance Ministry, however, warned in late June that it would be difficult to keep to the inflation target, with spending of extra non-oil and gas revenues causing inflation to spiral out of control.

The ministry proposed toughening the country's monetary policy and preventing budget spending from rising further.

The government failed to keep inflation within its target of 8% last year - the final figure was 11.9%, driven by high food and commodity prices.

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