Page 37 - RusRPTNov20

predicts -4%, the Ministry of Economy has -3.9% and the Central Bank of Russia (CBR) has anything between -4% and -6%.
BCS says industrial output will decline by -2.7%, retail will be down -5.4%, and real wages will fall1%.
The fight against inflation is going well and BCS expect inflation to end the year at around 4%, at the CBR’s target level up from 3.6% now and driven higher by seasonal increases in food prices. But given the devaluation of the ruble in recent months this is also a good result. BCS expect the value of the ruble to end the year at RUB69.5 (eop) to the dollar whereas the exchange rate touched RUB80 in September.
However, oil prices are not expected to recover. Trading at about $45 at the start of August oil fell to circa $40 towards the end of the month and are not expected to recover over the rest of the year.
The International Monetary Fund (IMF) has improved its forecast for contraction of Russia’s gross domestic product (GDP) in 2020 to 4.1% from the previous estimate of 6.6%, the IMF said in the World Economic Outlook report released on Tuesday. The GDP growth forecast for 2021 was reduced to 2.8% from 4.1%. The IMF also improved its outlook on the global economy, and now it expects the combined global GDP to fall 4.4% in 2020 against the previous estimate of 4.9%. In 2021, the GDP is expected to grow 5.2% in 2021, down from 5.4% expected previously. The fund also significantly raised its expectation for the average annual oil price by U.S. $5.51 per barrel to $41.69 per barrel this year and by $9.16 to $46.7 per barrel in 2021.
The Russian economy could rise 4–5% on the quarter, ​seasonally adjusted, in July–September, the central bank's forecasting department said in a statement on Wednesday. "In accordance with the estimate based on the latest figures for July–September, economic growth can amount to about 4–5% (on the quarter) adjusted seasonally,” it said. “Household consumption will be the key driver of recovery thanks to budget measures, the demand pent up during the restrictive measures, and a gradual emerging recovery of people's income." The weakening of the ruble will raise the prices in Russia for one or two quarters if the ruble remains unchanged, the researchers said. The ruble affects prices by 0.1 percentage points in September and 0.15 percentage points in October and November but the full effect can be seen after a lag.
After criticizing the government’s economic projections as being overly optimistic, Audit Chamber head Alexey Kudrin has released his own forecasts.​ With the help of the Gaidar Institute, Kudrin projects that Russia’s economy will contract 4.2-4.8% in 2020, worse than the economy ministry’s -3.9% forecast. Furthermore, Russia’s economy will rebound slower than predicted, at 2.2-2.7% growth in 2021, less than MinEk’s 3%.
37 ​RUSSIA Country Report​ November 2020 www.intellinews.com