The World Bank has lowered Russia's GDP forecast this year to 3.5% from 3.8%, and for 2013 the expected growth of the Russian economy is down to 3.6% from 4.2% previously.

The new World Bank forecast coincides with a more pessimistic forecast by Russian authorities: In September, the Economic Development Ministry adjusted the official forecast for GDP growth in Russia in 2012 to 3.5% and in 2013 to 3.7%. In 2011, the Russian economy grew by 4.3%.

"Despite a slight increase in oil prices, we expect a slowdown in Russia from 4.3% in 2011 to 3.5% in 2012 and 3.6% in 2013. This correction reflects the poor harvest and the worst global market outcome compared to the expectations at the beginning of the year," the World Bank report says.

The World Bank noted that this year several major agricultural regions of Russia experienced drought, decreasing grain production. Additionally, the drought affected not only Russia, but other global producers of grain, including the United States and Ukraine.

Increasing food prices may increase inflation in 2012 by about 0.3 percentage points.

"The tension in the labor market, low grain yields, and the recent rise in utility prices in the short term will increase pressure on prices in Russia. By the end of 2012, inflation will be around 6.5-7.0%, in 2013 inflation may be slightly higher than the revised target of the Bank of Russia, which forecasts 5% to 6%," the report said.

According to the Ministry, inflation in 2012 will be 7%, and in 2013 - in the range of 5-6%. In March, the World Bank predicted an inflation rate in Russia of 5-6% in 2012.