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. Last Updated: 07/27/2016

Surplus Reaches $50Bln

The government's budget surplus probably reached 1.23 trillion rubles ($50 billion) in the first seven months, the Finance Ministry said Friday.

Revenue totaled 3.87 trillion rubles, or 76.3 percent of the revenue the government planned to receive in the first nine months of the year, the Finance Ministry said, citing preliminary calculations. Government spending reached 63.4 percent of planned spending for the first nine months, the ministry said on its web site. The seven-month surplus increased from 1.07 trillion rubles in the first half.

"In November, at the peak of election campaigns, there will be pressure to increase spending," said Yaroslav Lissovolik, chief economist at Deutsche UFG bank. State Duma elections will be held in December and the presidential election is planned for March 2008. Increased spending will create inflationary pressure, Lissovolik said.

The government plans to increase spending by 20 percent next year from 2007. The government posted a budget surplus for a fourth consecutive year when it reached a record 2 trillion rubles last year.

President Vladimir Putin announced new spending in April to improve living standards, help high-tech industries develop and build roads and other infrastructure. Spending may boost inflation, which accelerated to 8.5 percent in June from 7.8 percent in the previous month. The government aims to contain inflation at 8 percent this year.