Russia: Weakness persists in Russia's industrial production
September 16, 2015
Russia’s industrial production remains depressed. It decreased in August for the seventh consecutive month, but this month’s contraction was less severe than in the previous four months. According to the Federal State Statistics Service (Rosstat), industrial production in August fell 4.3% over the same month last year, which was slightly up the 4.7% contraction registered in July and roughly in line with the 4.5% decrease the markets had expected.
The more moderate decrease in August was largely the result of a slower pace of contraction in manufacturing production. Manufacturing output in August fell 6.8% over a year ago, which came in above the 7.1% decline tallied in July. Electricity, gas and water continued to fall in August, although also at a more moderate pace (August: -0.7% year-on-year, July: -0.8% yoy). Conversely, mining and quarrying expanded for the second consecutive month, following three consecutive months of contraction.
A month-on-month comparison showed, however, that the mild improvement suggested by the annual data was not corroborated. Industrial production contracted a seasonally-adjusted 0.3% in August, which came in below the flat reading observed in July.
The output trend continued to suggest that weakness in Russia’s industrial production persist. The annual average growth in industrial output declined from minus 1.0% in July to minus 1.3% in August, which marked the slowest pace since April 2010.
Author: Ricardo Aceves, Senior Economist