Inflation continued to fall sharply in Russia in August, to 14.3% y/y, and there’s little standing in the way of another interest rate cut by the central bank next week. We expect a 50bp reduction to 7.50%. Elsewhere, the breakdown of Q2 GDP showed that the 4.1% y/y decline was concentrated in only a few sectors and we think the economy will suffer a contraction of only 3% over 2022 as a whole.
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