Fixed capital investments in Russia grow an estimated 1.5%-2% in Q1 - Central Bank
MOSCOW. May 3 (Interfax) - Russia's Central Bank estimates that fixed capital investments in Russia grew by 1.5%-2% in Q1 2017 in annual terms, the Bank of Russia said in commentary on the country's economic situation.
Production dynamics for investment goods remain volatile. Amid a continuing decline in construction in May, production of construction materials declined and production of machinery and equipment demonstrated unstable growth, mainly in transport. Moreover, companies are estimated to have increased investments in buying imported machinery and equipment amid the ruble strengthening. In the near future, supplies from abroad may continue to grow as a result of, among other things, the list of technological equipment and imports not subject to VAT being expanded, as well as the absence of competitive domestically manufactured alternatives. On the whole, investments in fixed capital increased by 1.5%-2% in Q1 2017 in comparison to the same period last year, the report said.
Investments also rose on a quarterly basis adjusted for the seasonal and calendar factor, according to the Central Bank.
The recovery in investment activity came about as a result of stable price dynamics for imported equipment, a decline in interest rates on loans, an increase in the financial stability of organizations, and an improvement in producer sentiments as demand for company products recovered, the Bank of Russia said.
As reported earlier, fixed capital investments in Russia in 2016 declined by 0.9% and fell by 10.1% in 2015. In Q1 2016 investments declined 1.2% in annual terms, in Q2 by 1.5%, in Q3 they grew by 0.5% and in Q4 they again declined by 1.3%.
According to the new baseline scenario forecast of Russia's Economic Development Ministry for 2017-2020 approved by the government at the end of April, fixed capital investments are expected to grow by 2%, 2.2%, 2% and 2.1% in 2017-2020 respectively.
