Page 54 - RusRPTAug22

4.0 Real Economy 4.1 Industrial production
Russia’s industrial output fell 1.8% in June y/y, following a 1.7% decline in the previous month but less than market forecasts of a 5.3% contraction, Rosstat reported on July 27.
The manufacturing sector faced an accelerating decline (down 4.5% in June compared with 3.2% in May). At the same time, natural resource extraction was growing again (up 2.3% year-on-year in June).
It was the second and steepest fall in industrial activity since February last year (chart), and several sectors that are the most exposed to sanctions were particularly hard hit. However, the overall level of production has been held up by the high commodity prices but volumes of things like gas production were down due to sanctions.
Perhaps the most worrying data released in July is the demographic. In the first six months of 2022, the population dropped by 430,300 people (in the equivalent period in 2021 it fell by 264, 200). Between January and May, in addition to natural decline (355,100 people), there was also a migration outflow (75,300 people).
“The Russian industrial production figures for June were surprisingly strong, which likely reflects a pick-up in oil production. But retail sales remain
54 RUSSIA Country Report October 2020 www.intellinews.com