Medvedev Seeks Curbs On Prices

The country must rein in consumer price growth and ensure macroeconomic stability, President Dmitry Medvedev told a government meeting Monday.

"It's necessary to return to the benchmarks we set earlier," Medvedev said at the Kremlin. "For this, we need to seriously focus on macroeconomic indicators."

He was speaking after signing a document that outlines budget policy recommendations for 2009 to 2011.

Annual inflation has accelerated every month since September, reaching a five-year high of 15.1 percent in May. Meeting the government inflation target of 10.5 percent this year will be "very complicated," Finance Minister Alexei Kudrin said June 17.

"Our goal is to lower inflation to 6 percent by 2011," Kudrin told reporters after Monday's meeting. The country will adopt a formal inflation-targeting regime "in the next few years" and will restrain government spending to damp price growth, he said.

Budget outlays will increase 25 percent this year and by "no more" than that in 2009, Kudrin said. Spending rose 40 percent in 2007 as inflation accelerated to an annual 11.9 percent, above the government's 8.5 percent goal.

Health care, education, transportation infrastructure, scientific research and development are "priority" industries for government spending in the next three years, Medvedev said.