Russian economy has shrunk considerably from early 2015

BOFIT Viikkokatsaus / BOFIT Weekly Review 2016/16

Seasonally adjusted figures show a substantial recovery in industrial output in the first three months of this year. Extractive industries, particularly oil production, drove that growth with production in the extractive sector rising nearly 3.5 % y-o-y. Seasonally adjusted manufacturing output remained rather flat in the first quarter with output down more than 3 % y-o-y. The economy ministry estimates GDP declined slightly less than 2 % y-o-y in 1Q16. Adjusting for the February 29 “leap day,” the fall was closer to 2.5 %.

The seasonally adjusted volume of retail sales slid further. Sales were down 5.5 % from a year earlier and down 12 % from two years ago. Real household incomes contracted nearly 4 % y-o-y. Driven by private sector wage hikes, nominal wages rose 6 % y-o-y, just a couple of percentage points less than the pace of 12-month inflation.

Retail sales and industrial output volumes, 2009‒2016
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Source: Rosstat.

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