Interfax: Russian economy in for slow, unsteady recovery – Central Bank
MOSCOW. Sept 1 (Interfax) – The Russian economy an expect slow, unsteady recovery in the next few quarters, the Central Bank’s Research and Forecasting Department said in its latest Talking Trends bulletin.
The Federal State Statistics Service (Rosstat) said in an initial estimate that GDP had fallen 0.6% year-on-year in Q2 2016. The Central Bank’s analysts said Rosstat’s data imply that GDP in the quarter grew 0.1%-0.2% on a seasonally adjusted basis.
The Research and Forecasting Department’s preliminary estimates indicate that if seasonally adjusted GDP growth rates in the second half of the year stay close to those for the second quarter, then GDP for the year could fall 0.5%-0.6%, in line with the Central Bank’s baseline scenario. “This picture is consistent with current unstable and mixed trends for output in various sectors of the economy,” the department said.
“Because of this, slow and unsteady economic recovery is expected in the next few quarters, given no new shocks,” the bulletin said.
If the index GDP assessments for the third and fourth quarter presented by the Research and Forecasting Department in July (respectively 0.2% and 0.4%-0.5% quarter-on-quarter, seasonally adjusted) prove accurate, then the GDP decline for the full year will be 0.3%, at the upper bound of the Central Bank’s baseline forecast range.
“Nonetheless, it is too early to conclude that a full-fledged recovery has commenced, despite the estimated positive pace of quarterly GDP growth. The difference between the weak, in our assessment, positive growth in GDP in the second quarter and a moderate recession that is comparable in scale is within the margin of error,” it said.
The contribution that budget spending makes to economic growth in the third quarter will be neutral. However, the budget system’s overall contribution to economic growth in July-October will amount to about 0.5 percentage points given the positive effect on the revenue side, according to the bulletin.