MOSCOW, October 26 (RIA Novosti) - Alexei Kudrin, deputy prime minister and finance minister, said on Friday inflation in Russia was likely to exceed 10% in 2007.
"It is predicted that it [inflation] will exceed 10%, which means we have fallen back to rates of two years ago, unless there are no more increases," Kudrin said, adding the high inflation was caused by soaring food prices.
Prices for some food products have increased recently by 40% due to global and domestic market trends.
Fuelled by food price growth, consumer prices in Russia grew 7.5% in the first nine months of 2007, or 0.3% more than in the same period last year. In September alone they climbed 0.8%, making the government's 8% inflation target for 2007 unrealistic.
Russian food producers and major retail chains agreed on Wednesday to freeze prices on certain food items until January 31, 2008.
Kudrin also said that capital inflow into Russia had resumed, reaching $10 billion over the last two weeks.
