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Russian inflation spikes on sanctions pressure

Economy squeezed further by slumping oil prices.

By Daniel J. Graeber

MOSCOW, Oct. 22 (UPI) -- Economic pressure on Russia's energy sector is taking its toll as the annual inflation rate topped the 8 percent mark, the Russian Central Bank said Wednesday.

The European Bank for Reconstruction and Development said sanctions imposed on Russian energy companies Rosneft, Gazprom Neft and others in response to the crisis in Ukraine were taking their toll on the Russian economy.

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The Russian Central Bank earlier this year said it expected inflation to stay around 7 percent.

Central Bank First Deputy Director Kseniya Yudaeva said a weekly gauge on the inflation rate showed an increase.

"It's already at 8.3 percent," the director said.

Russian state-backed media RIA Novosti reported slumping oil prices were putting additional strains on the Russian economy.

Russia's credit rating was downgraded last week by international ratings agency Moody's. The agency downgraded the credit rating for St. Petersburg and Moscow this week because of market risks.

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