Russia's cost of living soars by more than 14%

MARCH 24: Official figures show the price of some household staples - such as sugar - have jumped by as much as 14% over the past week. Inflation is set to keep rising in Russia where the rouble has weakened since the Ukraine assault was launched. The value of the currency has dropped by 22% this year. On Wednesday, Russia's economic ministry said annual inflation had jumped 14.5% in the week ending 18 March - the highest level since late 2015. The Federal State Statistics Service said the cost of sugar rose by as much as 37.1% in certain regions of the country and increased by an average 14%. Sugar, which is commonly used to preserve food or make liquor, was the biggest gainer in the week, the government agency found. Prices for onions was the second biggest riser over the week, up 13.7% nationwide and 40.4% in some areas. Meanwhile, nappies grew 4.4% more expensive. Prices for black tea rose 4% and toilet paper increased by 3%. Stephen Innes, managing partner at SPI Asset Management, said prices were higher because of the weaker rouble. "The biggest culprit is imported inflation," Mr Innes told the BBC. "Anything Russia imports is exponentially (pricier) due to the weaker rouble." The UK, along with the US and the European Union, have cut off a number Russian banks from financial markets in the West. They have also prohibited dealings with Russia's central bank, state-owned investment funds and the finance ministry. The Bank of Russia more than doubled its interest rate to 20% in March, in a bid to stop its currency from sliding further. A large number of Western businesses have pulled out of Russia because of the war in Ukraine. Others, such as the Swiss food giant Nestle, have withdrawn major brands such as KitKat and Nesquik. Videos on social media show shoppers scrambling to buy sugar and buckwheat at supermarkets in Moscow. Deputy prime minister Viktoria Abramchenko has told citizens the country is "fully self-sufficient when it comes to sugar and buckwheat". "There is no need to panic buy these goods. There is enough for everybody," she said. Russia has hit back at international sanctions, and threatened to seize the assets of businesses which have stopped operating in the country. It sanctioned US President Joe Biden and 12 other US officials last week. On Wednesday, Russian President Vladimir Putin announced that the country would start selling natural gas to "unfriendly" countries in roubles. It is understood the move is aimed at supporting the currency. The EU relies on Russia for 40% of its gas. However, many existing contracts are agreed upon in euros and it is unclear if Russia can change them. Mr Putin's announcement drove the rouble to a three-week high. It later closed at 97.7 against the dollar.

पूर्ण विवरण

सम्बन्धित सामग्री

Leader Nepal's call to address economic crisis

Madhav Kumar Nepal has urged the government to solve the economic problems facing the country including those related to livelihood and high cost of living.

Nepalnews भाद्र २०८०

Why Turkey’s currency is crashing after Erdogan got reelected

Turkish President Recep Tayyip Erdogan won reelection last month despite a battered economy and a cost-of-living crisis.

Nepalnews बैशाख २०८०

Why Turkey’s currency is crashing after Erdogan got reelected

Turkish President Recep Tayyip Erdogan won reelection last month despite a battered economy and a cost-of-living crisis.

Nepalnews बैशाख २०८०

Pakistan's economic crisis

Burgeoning inflation and a deepening cost-of-living crisis have left millions of people across Pakistan struggling to put food

Nepalnews फाल्गुन २०७९

Pakistan's economic crisis

Burgeoning inflation and a deepening cost-of-living crisis have left millions of people across Pakistan struggling to put food

Nepalnews फाल्गुन २०७९

Soaring US dollar spreads pain worldwide

The cost of living in Cairo has soared so much that security guard Mustafa Gamal had to send his wife

Nepalnews आश्विन २०७९

Cost-of-living crisis to hit women hardest

A cost-of-living crisis sparked in part by higher fuel and food prices is expected to hit women the hardest

Nepalnews जेष्ठ २०७९

Cost-of-living crisis to hit women hardest

A cost-of-living crisis sparked in part by higher fuel and food prices is expected to hit women the hardest

Nepalnews जेष्ठ २०७९

World faces largest cost-of-living crisis in a generation: UN report

UNITED NATIONS, June 9: The world is facing a cost-of-living crisis unseen in at least a generation, partly due to the Ukraine conflict, said a UN report on Wednesday. "The largest cost-of-living crisis of the 21st century has come when people and countries have a limited capacity to cope," said the second report of the Global Crisis Response Group on Food, Energy and Finance over the Ukraine conflict. The Ukraine conflict has trapped the people of the world between a rock and a hard place. The rock is the severe price shocks in food, energy and fertilizer markets, given the centrality of both Russia and Ukraine in these markets. The hard place is the extremely fragile context in which this crisis arrived: a world facing the cascading crises of COVID-19 and climate change, it said. "A shock of this magnitude would have been a significant challenge no matter the timing. Now, it is of historic, century-defining proportions," the report said. The Food and Agriculture Organization's food price index is at near-record levels and 20.8 percent higher than at this time last year. Energy market volatility has increased with the recognition that a prolonged conflict will lead to higher energy prices in the medium to long term. Crude oil has now reached over 120 U.S. dollars per barrel and energy prices overall are expected to rise by 50 percent in 2022 relative to in 2021. Fertilizer prices are more than double the 2000-2020 average. Maritime transport costs are more than triple the pre-pandemic average due to the lingering effects of COVID-19 and the destruction of the transport infrastructure of Ukraine, as well as higher volume of traffic- and congestion-related delays and other factors such as rising fuel costs, said the report. Rising interest rates and growing investor uncertainty have eroded both the value of developing countries' currencies, as well as their capacity to borrow in foreign markets, it said. "Of greatest concern are the vicious cycles beginning to emerge along the transmission channels of the crisis," said the report. Higher energy prices, especially diesel and natural gas, increase the costs of fertilizers and transport. Both factors increase the costs of food production. This leads to reduced farm yields and to even higher food prices next season. These, in turn, add to inflation metrics, contributing to what were already increasing interest rate pressures and tightening financial conditions. Tighter financial conditions erode the buying power of the currencies of developing countries, further increasing the import costs of food and energy, reducing fiscal space and increasing the costs of servicing debt, it said. The vicious cycles created by a cost-of-living crisis can also spark social and political instability, warned the report. To break the vicious cycles that feed into and accelerate this cost-of-living crisis, two broad approaches are required: mitigating the impacts of the shock and increasing the capacity of people and countries to cope, it said. To mitigate the impacts of the crisis, markets must be made more stable and debt and commodity prices must be stabilized. This is critical to immediately restore the availability of food for all people and all countries with equitable and adequate supplies at accessible prices. An effective solution to the food crisis cannot be found without reintegrating food production in Ukraine, as well as food and fertilizers produced in Russia, into global markets. Other initiatives include continuing to release strategic food and energy stockpiles into markets, controlling hoarding and other speculative behavior, avoiding unnecessary trade restrictions and committing to increased efficiency in the use of energy and fertilizers in developed countries, said the report. To increase the capacity of people and countries to cope, social protection systems and safety nets must be widened and fiscal space must be increased, it said. Social protection measures and fiscal space are, in fact, linked. Countries need support from the financial institutions to increase their fiscal space to, in turn, increase social protection spending, including cash transfers to the most vulnerable. The international community needs to help countries protect their poor and vulnerable, it said. There is no answer to the cost-of-living crisis without an answer to the crisis of finance in developing countries, said the report. Existing international financing mechanisms to support strong national fiscal responses need to be fully funded and operationalized quickly. Multilateral development banks must be capitalized and apply more flexible lending ratios. The global debt architecture is not ready to face the current crisis, which arrives during a moment of record-high debt levels and rising interest rates. Current tighter monetary conditions increase the risk of a systemic debt crisis, said the report. The Group of 20's Debt Service Suspension Initiative should be renewed, and maturities should be pushed back by two to five years. The Common Framework for Debt Treatment needs to be improved. A systematic approach to multilateral debt restructuring and relief, which includes vulnerable middle-income countries, must also be pursued to ensure long-term solutions to current challenges, it said. UN Secretary-General Antonio Guterres called for immediate action. "The message of today's report is clear and insistent: we must act now to save lives and livelihoods over the next months and years. It will take global action to fix this global crisis. We need to start today." UN Conference on Trade and Development Secretary-General Rebeca Grynspan, a member of the Steering Committee of the Global Crisis Response Group, who launched the report together with Guterres, also stressed the urgency of the matter. "We are in a race against time. This is why we are calling for action, action, and action. Dealing with the consequences of inaction -- let me assure you -- will be much more costly for all than acting now," she said.

Ratopati English बैशाख २०७९

World faces largest cost-of-living crisis in a generation: UN report

The world is facing a cost-of-living crisis unseen in at least a generation, partly due to the Ukraine conflict, said a UN report on Wednesday

Nepalnews बैशाख २०७९