Russia’s Economy will contract this year by 4.5 to 5.5%, but further growth is expected at 3.5 to 4.5% in 2021 and 2.5—3.5% in 2022. Such projections made today the Central Bank of the Russian Federation.
Earlier on Friday, the Board of Directors of the Bank of Russia lowered the key rate by 25 basis points to 4.25% per annum. The rate was lowered for the fourth time this year and to a new historic low.
As pointed out by the regulator in its press release, “the restoration of the Russian economy will be gradual, given the phased lifting of restrictive measures”. “The ongoing recovery of business activity in General remains constrained and heterogeneous across industries and regions,” acknowledges Central Bank.
“Indirect indicators show some recovery in investment activity. The continuing recovery of the services sector and retail trade. Consumer demand was supported by measures of fiscal policy,” — emphasizes the Bank of Russia.
However, he laments, “weak external demand, together with restrictions under the deal, OPEC+ is reflected in the decline in exports that makes a negative contribution to the dynamics of economic activity.”
moreover, the regulator warns, “the path of further economic recovery may be unstable due to the falling income, cautious consumer behaviour, cautious business sentiment, as well as restrictions imposed by external demand.”
“In these conditions, GDP will fall by 4.5—5.5 percent in 2020. Further, the projected recovery of the Russian economy by 3.5—4.5% in 2021 and 2.5—3.5% in 2022. The support of the Russian economy is affected by the actions of the government and the Bank of Russia to limit the economic impact of the pandemic coronavirus, including an easing of monetary policy and regulatory measures the Bank of Russia”, — sums up a Central Bank.
Recall also that the Russian the economy in February—March 2020 was under the powerful impact of two negative factors — the rapid spread of the pandemic coronavirus infection COVID-19 and its deleterious effect on the global economy and collapse in oil prices. Against this background, the rouble significantly depreciated against the dollar and the Euro. Reacting to the situation, the government and the Bank of Russia adopted several packages of measures to support the economy and citizens.
may 11, Russian President Vladimir Putin announced the end of may 12, a single period of days off, entered March 30, in the fight against COVID-19.
on 2 June Prime Minister Mikhail Mishustin reported on the nationwide state plan for the recovery of the Russian economy in 2020-2021 years, noting in particular that the cost of the plan will amount to about 5 trillion roubles. June 19, Putin was sent a revised draft of the national plan.
July 2, Deputy Minister of Finance of the Russian Federation Vladimir Kolychev said that the total cost of the measures (the bailout package), aimed at combating the spread of coronavirus infection in Russia and mitigating economic impacts from restrictions imposed, estimated to be worth about 4 trillion rubles. According to him, the main focus of the budget measures were made on several fronts: strengthening health systems, supporting citizens and businesses, the balancing of regional budgets.
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