BOFIT Viikkokatsaus / BOFIT Weekly 2022/49
First estimates released by the economic development ministry and Rosstat put the decline in Russian GDP in recent months around 4–5 % y-o-y. The preliminary October numbers from the economic development ministry suggest the contraction continued unabated last month. Most recent forecasts see Russian GDP contracting by 3–5 % p.a. both this year and next.
Weak consumer demand continues to hobble Russia’s economic performance. The volume of retail sales in October was still down by 10 % y-o-y. Russian consumers have seen their purchasing power eviscerated by persistently high inflation. In October consumer prices rose by 13 % y-o-y. The Russian labour market remains tight, with the unemployment rate remaining in historically low level at 4 % in October. Russia’s partial mobilisation of reserves shrank the labour force as several hundred thousand working-age men were either sent to the front or fled the country.
Economic development was supported in October mainly by industries related to the mobilisation of reserves and military production as well as construction. While branches such as clothing manufacture (particularly special clothing), fabrication of metal products, as well as manufacture of electronic and optical devices grew rapidly, manufacturing overall contracted by 2 % y-o-y. Construction activity accelerated in October, climbing at 10 % y-o-y. This was supported by other branches than housing, as residential housing construction contracted by 11 % y-o-y in October.
Mining & quarrying activity (includes hydrocarbon extraction) contracted in October by 3 % y-o-y. Crude oil output continued on a slightly declining trend. After falling for most of the year, natural gas production stabilised in October.
Russian crude oil production has declined slightly this year, while natural gas production fallen quite significantly
Sources: CEIC, BOFIT.