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with the rate of charge inflation easing to only a marginal rate. Russia finished 2019 with modest inflation of 3.5%, which is well below the Central Bank of Russia (CBR) 4% target rate and is expected to fall further in 2020.
Finally, business confidence remained historically subdued and dipped to the lowest since August 2017. However, a fall in business confidence is partial a seasonal phenomena. The parallel survey from Rosstat also always finds that business confidence falls in the autumn and winter months only to improve as the spring arrives in May.
4.3.2 Corporate profits dynamics
Russian companies had another good October earning RUB1,313bn of profits, the most recent data available, but corporate profits continue to trail slightly behind those of 2018 but well ahead of 2017 and 2016.
The recovery in profits began in 2016 following the crisis started by the collapse in oil prices the year before and built through to 2018. However in 2019 profits fell back a bit in the second half of the year to under perform those from 2018.
The profit results showed that Russia’s economic recovery really only got underway in the second half of 2018 when profitability bounced back, but that recovery has faded somewhat in 2019.
Still, the cumulative profits for 2019 were still clearly ahead of 2018 and totalled RUB13,002bn as of October 2019.
29 RUSSIA Country Report February 2020 www.intellinews.com
