Biggest drop in Russian production in over 3 years
Source: Bloomberg News |
March 19, 2013, Tuesday
|
Print Edition
Print Edition
RUSSIAN industrial output shrank in February, contracting by the most in more than three years as mining and utilities production weakened.
Output dropped 2.1 percent from a year earlier, when February had 29 days, after a 0.8 percent contraction in January, the Federal Statistics Service in Moscow said yesterday in an e-mailed statement. The median estimate of 19 economists in a Bloomberg News survey was for a 1 percent loss.
The economy of the world's largest energy exporter expanded last year at the lowest pace since 2009 as Europe's debt crisis and a slowdown in China sapped demand for its commodities. Bank Rossii, faced with the fastest inflation in 18 months, left borrowing costs flat for a sixth month last week, saying market rates were acceptable.
"We would expect industry to be close to stagnation even without the calendar factor," Vladimir Osakovskiy, chief economist for Russia at Bank of America Merrill Lynch, said by e-mail before the release. "Export and investment demand is weak, which constrains any existing potential for growth."
Mining shrank 2.2 percent after a 1.2 percent drop in January, the statistics service said. Output at utilities fell 10 percent after a 1.8 percent gain the previous month, while manufacturing shed 0.1 percent, improving from a 0.3 percent decline. Gross domestic product rose 1.6 percent from a year earlier in January, compared with 2.5 percent in December.
"If overall economic growth starts approaching 2 percent a year, this will likely tilt the central bank toward earlier policy easing," Vladimir Pantyushin, chief economist at Barclays Plc's investment-banking unit in Moscow, said by phone before the release. "With lending growth in double digits, it's hard to argue that monetary policy serves as a limiting factor."
Output dropped 2.1 percent from a year earlier, when February had 29 days, after a 0.8 percent contraction in January, the Federal Statistics Service in Moscow said yesterday in an e-mailed statement. The median estimate of 19 economists in a Bloomberg News survey was for a 1 percent loss.
The economy of the world's largest energy exporter expanded last year at the lowest pace since 2009 as Europe's debt crisis and a slowdown in China sapped demand for its commodities. Bank Rossii, faced with the fastest inflation in 18 months, left borrowing costs flat for a sixth month last week, saying market rates were acceptable.
"We would expect industry to be close to stagnation even without the calendar factor," Vladimir Osakovskiy, chief economist for Russia at Bank of America Merrill Lynch, said by e-mail before the release. "Export and investment demand is weak, which constrains any existing potential for growth."
Mining shrank 2.2 percent after a 1.2 percent drop in January, the statistics service said. Output at utilities fell 10 percent after a 1.8 percent gain the previous month, while manufacturing shed 0.1 percent, improving from a 0.3 percent decline. Gross domestic product rose 1.6 percent from a year earlier in January, compared with 2.5 percent in December.
"If overall economic growth starts approaching 2 percent a year, this will likely tilt the central bank toward earlier policy easing," Vladimir Pantyushin, chief economist at Barclays Plc's investment-banking unit in Moscow, said by phone before the release. "With lending growth in double digits, it's hard to argue that monetary policy serves as a limiting factor."
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