Bloomberg predicts a 4.7% decline in Russia’s GDP in 2022

After picking up in the first half of 2022, the Russian economy began to contract, reports Bloomberg. The agency calculated that GDP in the Russian Federation in the second quarter will decline in annual terms by 4.7%. At the same time, back in July, Bloomberg predicted a decline in the Russian economy by 8.8%, in June – by 8%, in May – 9.1%, in April – 9.5%, in March – by 10%.

According to economist Alexander Isakov, the Russian economy will lose four years of growth, returning to 2018 levels in the second quarter of 2022.

“We expect contraction to slow in the fourth quarter due to looser monetary policy supporting demand. However, the economy will lose another 2% in 2023 as the European energy embargo cuts exports,” he said.

Evgeny Suvorov, Chief Economist for Russia at CentroCredit Bank, believes that the crisis is moving along a very smooth trajectory. He said that the Russian economy will reach its lowest point at best by mid-2023.

Bloomberg notes that the quick reaction of the Russian authorities provided a “soft landing” for the economy, which, as analysts expected, would contract by 10% in the second quarter of this year. Banking economists including JPMorgan Chase & Co. and Citigroup Inc., eventually improved their forecasts and now expect Russian production to fall by just 3.5% for the full year.

However, the Bank of Russia forecasts that GDP will contract by 7% this quarter and possibly even more in the last three months of the year. According to his estimates, in the second quarter of 2022, the Russian economy will fall by 4.3%.

World Bank in June worsened forecast for Russia’s GDP for 2022 and expects a fall of 8.9%, in 2023 – by 2%, in 2024 – an increase of 2.2%. According to the Ministry of Economy of the Russian Federation, the decline in GDP this year will be 7.8%, next year – 7%.

Read more about the economic situation in Russia in the material “Kommersant FM” “The economy was offered scenarios”.

Daria Erozbek