In the basic forecast for the development of Russia’s economy in 2016, the world Bank laid the weakening of the ruble. This was announced at a press conference, the lead economist of the world Bank for Russia Birgit Hansl.
“We in our forecasts do not publish this figure [the forecast of the exchange rate of the ruble], this is done intentionally, so you don’t find this figure in our report <…> But I can tell you that in our base case scenario we lay the weakening of the ruble,” she said.
In 2017, the world Bank expects a slight strengthening of the ruble. Hansl told about this at the press-conference, devoted to the publication of the report of the world Bank about economy of Russia “the Long road to economic recovery” (.pdf).
The authors warn that the path to recovery for the Russian economy will be longer and harder than previously expected. According to experts of the WB in 2016, gross domestic product (GDP) of Russia will decrease by 1.9% and not 0.7% as previously expected. As a result following the results of current year Russia’s GDP will remain “significantly below” the level at which it was four years ago.
The report States that the main reason for the deterioration was the persistence of low world prices for oil. According to the baseline forecast, average by 2016 the price of a barrel of Brent will be only $37, whereas in the previous version of the document was expected to grow to $53. The oil price forecast new baseline scenario of the WB was more pessimistic than the pessimistic forecast of the sample in September 2015 — then even the skeptics believed that average by 2016 the price of a barrel falls below $40.
“The current base scenario of the world Bank assumes that in 2016 there will be a further contraction of the economy by 1.9%, and in 2017 will resume a slight increase in the amount of 1.1%. Medium-term forecasts for Russia will still be determined primarily by raw material prices,” — said in the report.
However, experts noted that the forecast level of poverty remains disappointing: all scenarios assume a growth in poverty and deterioration of universal welfare.