28 Oct 2022 15:55

Economic activity in Russia starts to fall again; decline could bottom out mid-2023 - Nabiullina

MOSCOW. Oct 28 (Interfax) - Economic activity in Russia began to decline again in September after stabilizing in the summer months, with the slump expected to bottom out in mid-2023, Central Bank Governor Elvira Nabiullina said at a briefing.

"As the economy has been adapting to the external restrictions more quickly, the decline in GDP in 2022 will be less significant than assumed in the middle of the year. This is associated with a more positive situation in the third quarter owing to industrial production and the agricultural sector expecting a record-high harvest this year," Nabiullina said in a transcript of the briefing posted on the Central Bank's website.

"We have improved our GDP forecast for this year and believe that the contraction of the economy will be 3.0-3.5%," she said.

"Nevertheless, according to recent data, economic activity has started to decline again in September after its stabilization in summer. This might be caused by weaker consumer demand and worse conditions for Russian exports, amongst other reasons," she said.

The recovery growth of the economy next year will start slightly later than assumed in July. The economy will reach the bottom of the decline in the middle of next year. Demand from the public sector will continue to support economic activity. The forecast of GDP for the next year has remained unchanged: it will shrink by 1.0-4.0% and resume an upward trend in the fourth quarter [0-1.5% year-on-year, according to the CBR forecast]," Nabiullina said.