Russia's GDP Growth Will Not Exceed 1.9% in the Second Half of 2018
OREANDA-NEWS The head of the Ministry of Economic development inks the fall in US GDP growth with increased uncertainty and increased volatility in the financial markets.
Russian Minister of economic development Maxim Oreshkin doubts that Russia's GDP growth in the III-IV quarters of this year will exceed 1.9%. He told reporters on the sidelines of the Eastern Economic Forum.
"We especially expect a slowdown in the first quarter of next year. But we also do not expect any big positive surprises from the III-IV quarters of this year. This is due to increased uncertainty and volatility in the financial markets. All this, of course, is not the background in which growth can be very seriously accelerated," the Minister explained.
"Unlikely to be higher than 1.9% [GDP growth in the III-IV quarters]", he added.
At the same time, the most serious slowdown in the Russian economy is expected in the first quarter of 2019 - then the indicator may slow down to 1% or lower.
According to RosStat, Russia's GDP grew by 1.7% (previous estimate - 1.6%) in the first quarter of 2018, in the second quarter - by 1.9% (1.8%).
The Minister of Economic development of the Russian Federation believes that potential sanctions against public debt will not be able to dramatically affect the economy of the Russian Federation.
"This is a question more to the Ministry of Finance, which will have to provide a program of borrowing in the new conditions. If there are no problems with the provision of the borrowing program, then there will be no such cardinal effects on the economy, too," he said.
At the same time, the Ministry of Economic development is working on a stress scenario in case of US sanctions on Russian debt and banks.
"We do all the assessments, they are non-public. In many ways, they are used to develop packages of measures that will be applied in a given situation," he said.
The ruble is now strongly deviated from the fundamental values, by the end of the year the rate will be 63-64 rubles per dollar, says the head of the Ministry of Economic development.
"The situation with the course-now there is a deviation from the fundamental course. How long can it last? It can last quite a long period of time. We have a floating exchange rate, volatility of capital flows is associated with the global situation, and with sanctions stories. Can it drag? Can. We have a forecast for the end of the year, and there is for the next 12 months. Here we do not see the reasons to change these indicators," the Minister said.
He added that at the end of the year the exchange rate is expected at the level of 63-64 rubles per dollar.