January inflation posted a new low of 2.2% yoy, down from 2.5%, continuing to surprise both the consensus and the CBR’s forecasts to the downside. Our models suggest that we are close to the bottom of inflation but, fundamentally, price pressure will remain weak in 2018-19E, leaving ample space for easing ahead (200bp this year and 150bp in 2019, much more than consensus expectations). The ongoing restructuring of corporate balance sheets, the sanctions and the lower crude price than before are contributing to the disinflation phase. #ChangingEurope #ChangingRussia
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