Russian inflation likely to decline markedly next year

Inflation in Russia is expected to decline markedly next year, while the growth trajectory remains depressing. The reason for restraint is that utility price hikes in July (average of 7.5%) and recent RUB weakness could put some upward pressure on inflation and possibly negatively influence expectations

Meanwhile, the growth trajectory remains depressing, as June real sector data confirm the recession in Russia worsened in Q2. Both IP (-4.8% y/y versus -4.0%) and real retail sales (-9.4% y/y versus -9.0%) declined more than consensus expectations. 

"Therefore,a gradual path of rate cuts appears justified", says Barclays.