By Tom Lasseter | McClatchy Newspapers

MOSCOW — Larissa Vasilyeva wound her way through a bustling outdoor food market in a working-class neighborhood in southwest Moscow, tallying in her head the rubles and kopecks she had left to spend for the week and wondering how much more food she should buy.

A year ago, Vasilyeva said, she spent about 1,500 rubles a week on groceries, some $59 at the time. Now, she spends 2,000 to 2,500, about $107 at the high end. That's steep for a country in which the average monthly salary was about $720 in May, according to official statistics.

"We have practically nothing left to buy clothes," said Vasilyeva, a retired economist. "People are very unhappy about it . . . there may be a political revolt."

Vasilyeva knows firsthand what mountains of statistics show: Underneath the booming Russian economy, fueled by large supplies of oil and natural gas, inflation is slamming many ordinary Russians.

While the strengthening ruble has helped — it's gained some 9 percent against the dollar since last July — inflation shows no sign of slowing.

Inflation last year in Russia was 11.9 percent, according to state statistics. In the United States, where inflation concerns are rampant, that figure was just under 3 percent in 2007.

"The impact is serious, it's one of the most difficult problems we have," said Tatiana Stanovaya, the head analyst at the Center for Political Technologies, a Moscow research center. "If the prices continue rising, the ruling power risks losing the confidence of a very large part of the population."

The Russian Finance Ministry said last month that it was going to be difficult to keep inflation at its target of 10.5 percent this year.

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July 21

HONG KONG (AFP) — Hong Kong's inflation rate hit 6.1 percent in June as food and energy costs continued to spiral upwards, official figures showed Monday in the latest sign of Asia's battle with surging prices.

News of the annual jump comes just days after the city's government introduced a raft of measures to try and shield its poorest residents from the spiralling cost of living, hoping the move will dampen growing discontent here.

Inflation is on the march across Asia, driven up by soaring fuel and food costs, raising fears that it will curb consumer spending, hit business profits and lead to slower economic growth, especially if interest rates rise.

The underlying inflation rate in the southern Chinese territory was also 6.1 percent, up from 5.7 percent year-on-year in May, according to figures released by the Census and Statistics Department.

A government spokesman said sustained increases in food and energy costs, and the strength of the local economy, had contributed to upward pressure on housing rents and the price of various goods and services.

"The inflation outlook for the rest of the year remains uncertain, due to the volatile international food and energy prices," the spokesman said in a statement.

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