What if Russian inflation was at 26%? The ‘truth’ behind gummy bears

Nothing escapes inflation. For this reason, the Russian economist Alexander Abramov decided to make gummy bears his particular thermometer to analyze a price evolution in Russia that has little to do with the forecasts proposed for this year.

The ‘Abramov index’ not only compiles the prices of these sweets (imported, to capture the effect of the exchange rate) but also includes 11 other products common to household purchases (bread, milk, chicken …) that They have allowed him to take a complete picture – not scientific – of the changes to the rise in prices.

According to reports that Abramov has been sharing through the social network Facebook (always a few days ahead of official publications) the inflation of November it is far from the 8.4% transferred by Russia; the economist’s calculations suggest that prices climbed last month to 26.1%, a new high.

Despite the lack of statistical rigor in this method, Abramov has attracted the interest of specialists looking to find out where price growth is heading, now in up to six years. “It is a good clue of what is happening because of its simplicity and reflects the real situation better that after the authorities established an average and smoothed it out, “he told Bloomberg Oleg Vyugin, a former senior central bank official and a regular reader of the Abramov index.

Where does this index come from?

Abramov, a financial markets specialist at the Russian National Economics University, started the index in 2015 as a school project with his daughter but it was last year that the indicator gave its first major warning of a price rebound after the central bank will begin to cut interest rates.

The success of your methodEveryone, aware of the lack of statistical rigor, is due to two factors: that he is recognized and esteemed as a teacher and that Russian citizens are very skeptical of the figures provided by the central bank, so they do not understand inflation as far-fetched may become much higher than reported. Even 18 points more, as Abramov indicates.