Growth in industry to remain slow in 2025 despite some improvements in April

RUSSIA ECONOMICS - In Brief 30 May 2025 by Evgeny Gavrilenkov

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After an abrupt slowdown of industrial growth in 1Q25 (1.1% up y-o-y that followed a 5.7% y-o-y increase in 4Q24 and 4.6% in 2024 as a whole), April statistics looked somewhat better, albeit marginally. In 4M25, industrial output grew by 1.5% y-o-y, which pulled the 4M25 tally to 1.2% y-o-y. Seasonally/calendar-adjusted industrial output grew in April by 0.9% m-o-m. The mining segment was down y-o-y by 1.0% in April and 3.0% in 4M25. In 4Q24 and 2024 as a whole, it was down by a mere 0.9% y-o-y in both periods. Manufacturing grew by 3.0% and 4.2% in April and 4M24. In 4Q24 and 2024, manufacturing grew by 10.7% and 8.5% (y-o-y in all cases). Gas extraction increased by 3.8% y-o-y in April, but in 4M25, by a strange coincidence, it was down by the same 3.8%. Rosstat stopped publishing statistics on oil extraction. However, data on associated gas extraction (as a by-product) hints that oil extraction may have contracted as it happened with associated gas (down 4.7% y-o-y in 4M25). Metal ores extraction grew in 4M25 by 2.6% y-o-y. The 4M25 performance was extremely uneven across sectors, which could have been caused by various factors, such as uneven financing from the budget (it soared in December and cooled down in the following months). It looks as though consumer demand also cooled down - given that in the seven days ending on May 26, w-o-w inflation remained low (at 0.06%). The MTD tally climbed to a mere 0.21%. Inflation m-o-m in May (as a whole) will decelerate compared to previous months and moderate to about 10.0% y-o-y - with prospects for further deceleration in summer. In a few days, the CBR will publish banking sector statistics, and it could be well the case ...