Russia: Industrial production picks up pace in December
January 23, 2020
Industrial output rose 2.1% year-on-year in December, accelerating from November’s meagre 0.3% increase which had marked the weakest result since December 2017.
December’s acceleration was spearheaded by a notable upturn in the manufacturing sector. Furthermore, the mining sector continued to gain momentum while contraction in water supply and sewage activities softened significantly compared to the previous month. On a less positive note, electricity, gas, steam and air conditioning supply dipped for the first time in nine months in December, likely amid warmer than usual weather.
On a monthly basis, industrial production edged up 0.2% in seasonally- and calendar-adjusted terms, rebounding from November’s 0.6% dip. Meanwhile, annual average growth in industrial production remained stable at November’s 2.4%.
Industrial production should gain some traction ahead, as argued by Dmitry Dolgin, chief Russia economist at ING:
“Looking into 2020, we see scope for acceleration in the industrial output growth, mainly thanks to the expected increase in the budget support. […] For now, we keep our previous expectations of industrial output accelerating to 2.7% in 2020 and see some upside risks to this forecast if the government confirms plans to accelerate spending.”
Author: Almanas Stanapedis, Economist