Inflation is serious in Russia and people are stealing cream | Real Time Headlines

A burglary at a small food store in the Russian city of Yekaterinburg doesn’t usually make headlines around the world, but this was different.

CCTV recording Photos taken at the Dairy Place store in early November show the door being smashed and a man rushing to empty the till. Another man went straight to the refrigerator and looted 20kg cream from coolerRussian media reported.

The store owner said on Telegram that the robbery showed that Butter is like “gold” now According to Google Translate. CNBC could not independently verify lens.

Dairy Place isn’t the only victim of butter theft, with a series of recent incidents Similar events prompt some stores Lock product in container. Standard 200g cream stick Now it costs about 200 rublesor nearly $2, with prices up 30% since December 2023, according to the National Bureau of Statistics Rosstat.

The theft of this essential product has drawn attention to sharp price increases in Russia.

Moscow resident Stanislav told CNBC: “Prices of basic food have been rising for the past three years. The situation is getting worse day by day and accelerating, especially this year.”

“Of course, it depends on the type of food. The price of some commodities will fall, such as buckwheat. During the Covid-19 pandemic in 2020, its cost was higher, but now it has dropped three times. But this is what I think for all other food prices They are all rising by about 10% to 40% every year,” he added.

Russia’s October inflation rate was 8.5%, well above the central bank’s 4% target. This prompted the bank last month Raise interest rates to 21% — the highest level in more than 20 years — and further rate hikes are expected in December.

So far, high interest rates have shown little sign of curbing price growth, with food inflation being felt particularly keenly by shoppers. Dairy products, sunflower oil, and vegetables (especially potatoes, which contain Prices up 74% since December last year) was among Commodity prices continue to risebased on weekly data Statistical service Rosstatbecause demand exceeds supply.

Anton Barbashin, a Russian political analyst and editorial director of Riddle magazine, said rising prices are inevitable for most citizens, telling CNBC that “in fact half of Russians will Part of their income is spent on food, so they feel inflation the most.

“Product inflation is now the biggest driver of inflation. As a result, prices of basic commodities, food and other personal items have increased the most,” he noted.

“So far, the strategy of most Russians has been to downgrade their consumption patterns and opt for lower quality goods. Postponing any long-term purchases. However, this pressure is not evenly distributed. The trouble is still barely felt in Moscow. The most affected It’s the people in the smallest towns and rural areas,” he noted.

These are accompanied by Russia’s move towards war economy Since the invasion of Ukraine in February 2022, national defense spending has increased significantly, and domestic military equipment production has been prioritized over agricultural production. Russia’s economy has performed better than IMF expectations since invasion of neighboring countries began looking forward to it It will grow 3.6% this year.

Russia’s leadership has tried to sidestep criticism of rising prices, blaming “unfriendly” countries – Ukraine’s allies – for the conflict, sanctions and supply shortages.

Russian President Vladimir Putin has denied that Russia traded “butter for guns” and defended higher defense spending.

“If we spend too much money on guns and forget about butter – that is not the case. I would like to emphasize that all the development plans announced earlier and the realization of strategic goals and all the social commitments undertaken by the country Putin in October Var At the plenary meeting of the Representative Discussion Club, he stated: TASS reports.

While many Russians link the war to inflation, it is risky for ordinary citizens to openly criticize the invasion – or what Moscow calls a “special military operation” – as any act that is seen as “discrediting” the military. Possible penalty of up to five years in prison.

Stanislav declined to give his last name because of the risks associated with criticizing the war. causing prices to rise.” Telling the truth is dangerous in Russia. “

“Smart people… understand what’s going on in the economy, but most blame foreign ‘unfriendly’ countries[for rising prices]. The official term ‘unfriendly’ is often used in bills and propaganda,” he said.

Even as the Kremlin deflects responsibility for the price hikes and the war from itself, it still seeks to reassure the public that it is taking action against product shortages.

Last year, there was a shortage of eggs – with prices rising more than 40% – Prompt the government to remove import duties on this product. The government says it will buy eggs from “friendly” countries, and Russia imported 235 million eggs from these countries in the first quarter of this year. Belarus, Azerbaijan and Türkiye, according to Russian media reports.

In October this year, the government Says it will monitor butter prices It will support a “systemic increase in production” as the dairy industry continues to struggle to meet demand.

Anton Barbasin, a Russia analyst who no longer lives in the country, noted that Russia’s propaganda machine means there is little sign of dissatisfaction with the government or the president over stubborn inflation.

“Separating Putin’s policy issues from the personal struggles of Russians has been one of the Kremlin’s great achievements,” he said.

“Of course, this is not a universal rule, but so far we have not seen these fights translate into accusations of the president or war.”

So far, he said, propaganda has suppressed popular discontent, with some Russians simply believing, “This is war, and war is costly.”

“But the pace of economic change in Russia is accelerating, so we might expect an increase in the number of people who want to end the war,” he said.

“We also should not ignore that the Kremlin’s blaming of Russia’s economic problems on Western activities and sanctions provides the Russians with an easy target to blame.”