GlobalSource Partners | Country Insights | Russia Economics

Rosstat reported that the country’s industrial output contracted in January by 2.5% y-o-y. Mining was down by 7.1% and manufacturing by 1.0% y-o-y. In the same report, the statistical agency significantly revised up December 2020 statistics, particularly on the manufacturing side. The 4Q20 and an...

The Russian budget posted a small deficit in January as expenditures were up y-o-y

RUSSIA ECONOMICS · In Brief · 10 Feb 2021

Federal budget revenues dropped by 3.7% y-o-y in January amid 3.3% y-o-y growth of expenditures. Oil-and-gas revenues were down by 19.7%, while non-oil-and-gas revenues were up by 6.7% y-o-y. In January, the government collected 8.0% and spent 7.8% of the annual plan. The result looks good as usu...

Minfin pushes OFZ yield curve up

RUSSIA ECONOMICS · In Brief · 10 Feb 2021 · 1 response

Today the Finance Ministry conducted three primary OFZ auctions and raised R49.4 bln (in three placements), the best result since the beginning of the year. However, the cost that the borrower paid looks high. As a reminder, last week the Ministry cancelled the placement of fixed-rate paper due t...

Russia’s current account widens in January which creates a solid base for economic recovery

RUSSIA ECONOMICS · In Brief · 09 Feb 2021

Russia’s current account and trade surplus widened in January relative to previous months. The current account surplus reached $6.8bn, while the trade surplus was at $9.4 bn. In 4Q20 as a whole, the current account surplus at $5.5bn, and the trade surplus was at $21.5 bn. Based on the CBR prelimi...

Russia political/pandemic update: Epidemiological situation stabilizes, politics gets more intriguing

RUSSIA ECONOMICS · Report · 05 Feb 2021

In the aftermath of the New Year holiday period, the country’s daily registered cases of newly infected people fell from around 27K (where they were at the very end of 2020) to 16-17K as of early February. Even though the authorities did not tighten restrictions, it looks as though Russians mostl...

Inflation y-o-y to stabilize, disinflation expected from March

RUSSIA ECONOMICS · In Brief · 03 Feb 2021

Rosstat reported that during the last week of January, the w-o-w inflation was at zero, and as of February 1, inflation YTD reached 0.7%. It is not yet the official number for January as monthly inflation numbers assume a broader consumption basket than preliminary estimates of weekly inflation. ...

Russian macro: money markets becoming less distorted in 2021 as Minfin’s meddling set to subside

RUSSIA ECONOMICS · Report · 02 Feb 2021

Ruble liquidity tightened in 4Q20 and continued to do so in January, as well, despite massive spending from the federal budget at the very end of the year. In December alone the government spent R3.9 trln (versus R2.1 trln in November). The federal budget deficit reached R1.7 trln in December, a...

GDP contracts by a mere 3.1% in 2020

RUSSIA ECONOMICS · In Brief · 01 Feb 2021

Rosstat reported that the Russian GDP decreased by 3.1% in 2020, which is in line with GKEM Analytica’s expectations. As was mentioned in the previous notes, ongoing regular upward revisions of monthly statistics explain a slightly better outcome relative to what GKEM Analytica expected. On top o...

OFZ issuance: poor start of the year

RUSSIA ECONOMICS · In Brief · 29 Jan 2021

The first month of the year 2021 was not fruitful for the Finance Ministry in terms of the borrowing on the local market. Since the beginning of the year, the government has managed to place OFZ worth only R61.1 bln, which is a very poor result given the annual plan of R3.7 trln. Demand from inte...

Russia’s economic performance has seemingly improved in 4Q20, albeit accelerated inflation suppressed real retail sales

RUSSIA ECONOMICS · In Brief · 28 Jan 2021

According to Rosstat’s preliminary estimates, Russia’s retail sales contracted by 4.1% in 2020. Food retail was down by 2.6%, while non-food retail dropped by 5.2%. These numbers are generally in line with expectations. As inflation accelerated in 4Q20, retail sales decreased in this quarter more...

As w-o-w inflation remains high the government considers some administrative measures

RUSSIA ECONOMICS · In Brief · 27 Jan 2021

Rosstat reported Russia’s inflation during the seven days ending January 25 remained at 0.2%, i.e., it was on average the same as w-o-w inflation in December and earlier in January. The y-o-y inflation in January will likely be close to 5.5%. A closer look at the breakdown of inflation components...

The Russian industry contracted by 2.9% in 2020, as the OPEC+ deal pulled mining down while manufacturing grew moderately

RUSSIA ECONOMICS · In Brief · 25 Jan 2021

The contraction in 2Q20 and 3Q20 (by 6.7% and 4.8% y-o-y, accordingly) was deeper. After the initial shock caused by the pandemic in 2Q20, production was catching up almost all across the board. Mining was still down by 8.4% y-o-y in 4Q20 (and by 7.0% in 2020 as a whole). Manufacturing was up by ...

The Russian budget: decent execution in 2020 sets a good base for 2021

RUSSIA ECONOMICS · In Brief · 22 Jan 2021

The Finance Ministry reported that the federal budgetary spending massively increased in December, and in 2020 as a whole, the government expenditures exceeded R22.8 trln. In December alone, the government allocated 17.1% of the annual figure. Both figures appeared well above the expected. Meanwh...

The Russian ruble: settling in the comfort zone

RUSSIA ECONOMICS · Report · 19 Jan 2021

During the pandemic-hit 2020, the Russian economy demonstrated that its ability to absorb external shocks is rather strong, as its GDP contraction was moderate, while in the past decade it demonstrated that it lacks strong growth drivers as the average annual economic growth was quite unimpressiv...

The current account widens in 4Q20 as exports grow

RUSSIA ECONOMICS · In Brief · 19 Jan 2021

The Central bank released its first estimate of the 2020 balance of payments. The current account was in surplus at $32.5bn, and the figure is close to what GKEM Analytica expected (around $35bn or 2.4% of GDP). Meanwhile, in 2019 the current account surplus was twice as wide – $64.8 bn.The trade...