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Russian December consumer prices rise the fastest in 5 months

Russian December consumer prices rose 0.8%, the fastest pace in five months, driven by higher fruit and vegetable prices. Annual inflation for 2006 matched the government's revised target of 9.0%.

The Moscow-based Federal Service of State Statistics report matched the median forecasts of 12 economists surveyed by Bloomberg December 27 for both monthly and annual inflation. Prices for fruit and vegetables jumped 3.6%. Rising wages and employment have sparked a consumer spending boom in Russia, underpinned by swelling revenue from oil and natural gas, the country's main exports. Russia is heading for an eighth year of economic expansion, as high oil prices help swell the nation's foreign currency reserves, allowing it to pay back debt. Economy Minister German Gref said on November 21 annual inflation would slow to 9% by year's end. Russia missed its 10% inflation target both last year and in 2004. (Bloomberg)