Russia hit by slowdown
MOSCOW: Russia’s economy slowed more than forecast despite a rally in oil, its chief export, ending three quarters of accelerating growth that followed the country’s worst recession this century.
Gross domestic product added an annual 1.8% in the third quarter, down from 2.5% in the previous three months, the Federal Statistics Service said on Monday, citing preliminary data, which don’t include a breakdown.
The result missed a median estimate of 2% in a Bloomberg survey of 19 analysts.
Capital Economics said the weakerthan-expected performance was probably caused by slow growth in industrial production, as well as one fewer working day in this year’s third quarter than in the same period of 2016.
Adjusting for the calendar difference, the expansion reached 2.4% from a year earlier, according to Goldman Sachs Group Inc.
Despite a government vision of an economy remade by the crash in energy prices and a currency crisis that followed, Russia is increasingly resembling its old self as consumer demand comes to the fore.
Expansion is falling back to the limit of what the central bank believes the economy can accomplish, with gains in GDP forecast to lose more momentum and slow slightly every quarter next year.
“The slowdown in GDP growth in the third quarter was driven entirely by weakness in the industrial sector,” said William Jackson, an analyst at Londonbased Capital Economics, which cut its full-year forecast to 1.8% from 2.3% after the report.
“In contrast, other monthly activity figures — covering the retail, construction and agricultural sectors — all strengthened.”