After Russia instituted its ban on western food imports in August, we noted there was a risk the measures could end up hurting average Russians just as much, if not more, than European farmers.
We also noted that propaganda dynamics could make it hard for westerners to discern the truth with regards to what was really going on.
With that in mind here’s some colour on the food ban’s consequences from Hugo Bain, Senior Investment Manager at Pictet Asset Management following a recent trip to Russia:
Inflation continues to be a problem – the country is likely to overshoot its inflation target of 5 per cent by a wide margin this year. Ironically, I found that it was more Russia’s own retaliatory measures, rather than Western sanctions, that have affected the economy the most: during the trip, I heard that Moscow’s ban on Western food imports in August has led to price increases of up to 20 per cent for chicken in rural areas. Inflation continues to be a problem – the country is likely to overshoot its inflation target of 5 per cent by a wide margin this year…
Call that Russia’s chicken Kiev cost, we suppose?
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