Russian inflation slows to 17.1% in May before central bank meeting

(Reuters) - Consumer inflation in Russia slowed to 17.10% in year-on-year terms in May from 17.83% in April, which was its highest level since January 2002, data showed on Wednesday, days before the central bank's rate-setting meeting.

The central bank is expected to cut its key interest rate by 100 basis points to 10% on Friday as it tries to make lending more affordable amid sluggish consumer demand and a pause in inflation, a Reuters poll suggested.

Monthly inflation slowed to 0.12% from 1.56% in April, data from the federal statistics service Rosstat showed.

In March, monthly inflation jumped to 7.61%, its biggest month-on-month increase since January 1999, following Russia's move to send tends of thousands of troops into Ukraine on Feb. 24.

Rosstat data also showed that on a weekly basis consumer prices declined 0.01% in the week to June 3 after staying flat in the previous week.

In annual terms, inflation slowed to 17.02% in the latest week from 17.35% a week earlier, the economy ministry said.

"Stable inflation, although temporary, allows the central bank to ease its monetary policy," analysts at Raiffeisen Bank said in a note.

High inflation has been the key concern among households for years as it dents living standards, a fall which this year will be aggravated by a steep economic contraction.

Rosstat gave the following details:

RUSSIAN CPI May 22 April 22 May 21

Mth/mth pct change +0.12% +1.56% +0.74%

- food +0.60% +2.87% +0.96%

- non-food -0.09% +0.53% +0.74%

- services -0.32% +1.07% +0.44%

Y/Y pct change +17.10% +17.83% +6.02%

Core CPI y/y pct change +19.87% +20.37% +6.04%

(Reporting by Reuters)