Page 29 - RusRPTJun19

4.0 Real Economy 4.1 Industrial production
Russia's industrial output growth in April 2019 surprised after it surged to 4.9% year-on-year (but was then revised to 4.6%) after 1.2% growth in March, according to the latest data by Rosstat statistics agency, only to be immediately revised down to 4.6% due to an error.
The notable increase in industrial output comes as a surprise, as consensus expectations of economists surveyed by Reuters stood at 1.5%. As reported by bne IntelliNews, first-quarter output and GDP growth came in unexpectedly weak, leaving analysts wondering when will the government spending kick in this year.
Now that industrial output in April showed the fastest y/y growth in the past two years, the data is likely to be received with scepticism, scrutinizing Rosstat's bumpy indicators and seasonal factors at play. Without accounting for seasonal and calendar effects, industrial output expanded by 1.4% in April after 0.6% decline in March.
Rosstat revised April’s industrial production growth figure down from 4.9% to 4.6% y/y, citing a reporting error from a gas company in the Yamalo-Nenets Autonomous District. The Yamalo-Nenets Autonomous Oblast is causing data problems yet again. Recall in February, when Russia surprised forecasts with 2.3% GDP growth after Rosstat revised Jan-Nov 2018 construction data up by 5 percentage points due to unreported figures from Novatek’s Yamal LNG plant. While the latest data revision does not meaningfully change the macroeconomic picture—4.6% industrial production growth is still higher than analysts expected—the need for another serious
29 RUSSIA Country Report June 2019 www.intellinews.com