Ministry of Finance: Food prices are rising due to the disproportion of demand and production capacity

The agency considers the outpacing growth of demand in 2021 in relation to production capabilities to be internal prerequisites for overheating. Among the external factors, the budgetary and credit pumping of money in developed countries and the global shortage of production capacity in certain commodity groups are indicated. These factors, according to the ministry, form an "increased inflationary background".

As the FAS told the Izvestia newspaper, the agency constantly monitors and analyzes the cost of food products as part of the president's instructions. They stressed that they are not developing a bill that limits the margins on products in retail chains.

Food prices are growing at a faster pace. According to the latest data from Rosstat, the increase in the cost of goods and services in August this year compared to August 2020 was 6.68%. The cost of food products increased by 7.7% over the year. Sugar (by 38.1%), sunflower oil (by 27.3%) and eggs (by 15.4%) rose the most of food products.

The word "overheating" in Russia is usually used by the monetary authorities in relation to the lending situation. The rapid growth of mortgages or unsecured loans of citizens has repeatedly been called overheating. The rise in food prices was not called overheating even in 2014, when inflation exceeded 10%, the newspaper notes.