Russia: Economic growth accelerates in Q2 but remains weak nonetheless
GDP growth accelerated to 0.9% year-on-year in the second quarter of 2019, according to a preliminary estimate released on 12 August. This was almost double the first quarter’s 0.5% expansion and was in line with the expectations of most market analysts, as well as those of the Central Bank.
While a breakdown by components is not yet available, faster industrial output growth and slowly strengthening consumer demand metrics likely led the acceleration in the second-quarter. The ruble gained ground against the U.S. dollar in Q2, which, coupled with moderating price pressures, lower unemployment and slightly less downbeat consumer confidence, should have supported private consumption. That said, intensifying external headwinds in Q2 likely curbed the overall expansion. Particularly, merchandise exports contracted for the first time in nearly three years in the quarter amid constrained oil production and low global crude prices.
A comprehensive estimate of national accounts will be released in September.