Russia's GDP growth up to 2% in January

Russia's GDP growth up to 2% in January
Russian GDP growth picks up speed with 2% growth in January after 1.4% in December / bne IntelliNews
By bne IntelliNews March 16, 2018

Russia's GDP growth in January stood at 2% y/y in January 2018, after 1.4% y/y growth seen in December, the Ministry of Economic Development estimated on March 15.

The acceleration in economic growth was driven by a strong performance in the manufacturing sector that gained 4.7% y/y in January versus 2% y/y decline in the previous month.

However, the ministry cautioned that the pick-up was due to temporary factors, Alfa Bank commented on March 15.

Alfa analysts believe that the temporary spike in growth could be attributable to finalization of the Kerch bridge to the Crimea peninsula, which according to recent reports is expected to open in May.

"This confirms our view that stronger growth can be expected in the first half of 2018 with a slowdown in the second half of 2018 and is in line with our expectations of just 1% GDP growth this year," Alfa believes.

Russia's GDP growth came in at 1.5% in 2017, undershooting the government target of 2.1%. The medium-term economic growth goal remains at 2%, but even this would not be enough to comply with the economic promises made by President Vladimir Putin in his recent state of the nation address.

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