Page 27 - RUSRptOct18

RD-180 engines to United Launch Alliances (ULA).
2.12 Polls & Sociology
A Levada Center poll in August showed a sharp increase in anxiety in society compared to 2017 . The last time a similar dynamics was recorded before the default of 1998, Levada Gudkov, director of the Levada Center, told Kommersant. Most of the respondents were worried about the increase in prices in August - 72% (2017 - 61%), poverty and impoverishment - 52% (45%), unemployment - 48% (33%), corruption 33% (33%) and unavailability of medical care - 31% (26%). "Respondents became more likely than in 2017 to show concern primarily about problems related to the well-being and income of citizens," sociologists write. "At the same time, concern about the increase in unemployment, recorded in the August studies, is higher than in previous years: almost every second Russian now worries about it." Experts note the return of confidence indicators to power structures to the level of 2012-2013. after the rise of social optimism in 2014-2017.
3.0 Macro Economy 3.1 Macroeconomic overview
GDP growth in August in annual terms was 1.0% - the lowest level since the beginning of the year , according to the Ministry of Economic Development. The annual growth rate of the economy in July was 1.8%, in June 1.1%, and in May 2.5%. In general, for January-August, the agency estimated growth at 1.6%.
Rosstat released the adjusted estimate of 2Q18 GDP growth and published its breakdown by industry on September 10. The figure announced in early August, 1.8% y/y, was revised upward to 1.9%.
As far as the growth structure is concerned, the pattern of non-tradables in the fore was complemented by a more than 2.5% y/y expansion in both mining and manufacturing.
The revised print is now closer to VTBC’s estimate of 2.0%, which it calculated on an industry-by-industry basis.
Financial intermediation continues to lead the growth list, accelerating to 8.6% y/y from 5.9% in 1Q18, explained by the continuing expansion of the loan portfolio. Unlike other sectors, financial intermediation is never capacity constrained: the uptick in the level of activity does not depend on the labour employed and the capital applied. Instead, the output of the financial sector is defined by the demand for borrowing and the level of risk.
There is also a visible recovery in construction, from -5.1% y/y in 1Q18 to +0.8%. The recovery was most likely helped by non-residential construction, as the volume of residential buildings was sharply down by 10.3% y/y in 2Q18.
27 RUSSIA Country Report October 2018 www.intellinews.com