The Russian economy slowed down twice


Rosstat has published preliminary estimate for GDP growth in the second quarter of this year. In April—June, Russia’s GDP decreased by 0.6% compared to the same period of the previous year. Thus, the rate of economic contraction has slowed by half in the first quarter of 2016, the GDP amounted to 1.2%.

According to Rosstat, GDP declining at an annual rate for six consecutive quarters. But economists HSE estimate that GDP falls quarter on quarter for two years (with the exception of the third quarter of 2015, when the economy grew at the expense of factor stocks). According to experts from the HSE, since the beginning of the crisis, the economy has lost about 5.5% of GDP.

HSE assesses the dynamics of GDP on the basis of changes of production of basic industries (agriculture, industrial production, construction, cargo turnover, retail and wholesale trade) QoQ after seasonal adjustment, explains the leading expert of the Center of the HSE Mykola Kondrashov.

Previously, the Ministry also estimated the decline in GDP in the second quarter of 0.6% (coincided with the data of Rosstat). According to the Ministry, in the first half of 2016, the GDP decreased by 0.9% compared to the corresponding period last year. The Minister of economic development Alexei Ulyukayev on August 4, did not rule out that in the third quarter of 2016, the GDP may show a small positive trend. “I think it will be around zero in the third quarter, maybe slightly negative, maybe a little plus,” he said (quoted by TASS).

Experts of Bank of Russia earlier announced the end of the recession in the economy. “The index rating of Russia’s GDP suggests that the recession is behind us, and ahead of a slow growth economy”, — stated in the Bulletin of the Department of studies and forecasting of the Central Bank. Experts of the Central Bank estimated the GDP growth for the second quarter of 2016 to the previous quarter at 0.2—0.3% in the current quarter, the Central Bank expects growth of 0.4%.

Signs of recovery from recession saw Bloomberg, pay attention to the increase in volumes of rail and container traffic and the growth in electricity demand. However, the median forecast of 19 analysts surveyed by Bloomberg had pointed to a decline in GDP of 0.8% in the second quarter — the Federal state statistics service was better.

The base forecast of Ministry of economic development suggests a decline of GDP by the end of 2016 at 0.3%. In early August, Ulyukayev said that the forecast for GDP growth in 2016 will be updated. “By year until we believe that minus 0.2%, but will still clarify — the situation is in such a precarious balance,” the Minister said.

Evaluation of the HSE, the decline in GDP this year will amount to about 1.5%. The world Bank believes that the Russian economy will shrink this year by 1.2% (but will grow by 1.4% in 2017), the international monetary Fund predicts a minus of 1.2% this year and 1% next.