Industrial Production in Russia Increased Unexpectedly
OREANDA-NEWS Industrial production in Russia in February accelerated growth in annual terms to 4.1% from January 1.1%, according to Rosstat. According to statistic, the increase was mainly due to growth in manufacturing.
On a monthly basis, industrial production growth in February was 0.4%, and with the exception of seasonal and calendar factors — 1.2%.
Last year, industrial production increased by 2.9% compared to 2.1% a year earlier, the Ministry of Economic Development predicted 3%.
The largest increase in production in February-5.1% in annual terms-was recorded in the extraction of minerals. Growth in the manufacturing sector in annual terms was 4.6% (also 6.6% in monthly terms). In water supply, sanitation and waste disposal, annual growth reached 1.8%. In the field of electricity, gas and steam, a decline of 1.1% was recorded.
"It is very pleasant that processing has grown – for at least the last three months it has had a weak zero or even negative dynamics. Now we see 4.6% — this is the maximum since July last year. Partly worked and calendar effect-because in February 2018 was 1 working day less than this February," — says the analyst of Nordea Bank Tatiana Evdokimova.
If you look at the dynamics of individual industries, it is clear that the growth is associated with the acceleration of production of a number of building materials. We can assume that this is due to the implementation of any large-scale buildings. Either this is a renovation, or the start of projects within the framework of presidential decrees is approaching, the expert believes.
The second driver is mechanical engineering. These are also products partially manufactured by the state order – buses, cars, equipment.
If we are talking about the industries that produce building materials, it is, first of all, timber processing. But it, and the chemical industry, and the production of machines – these are the sectors that have grown for a long time, reminded the Deputy Director of the research Institute "Development Center" HSE Valery Mironov.
In his opinion, perhaps we are talking about the beginning of the round of investments in processing. Last year, against the backdrop of a number of factors, primarily the rise in oil prices and the still weak ruble exchange rate, we saw a 30 percent increase in profits in nominal terms. This created the conditions for the growth of investment in the industry – primarily export-oriented.
At the end of the year, there was no such reaction due to the sanctions uncertainty. It is possible that now the fears have somewhat dissipated, perhaps there were specific agreements with foreign partners. Against this background, those 2 trillion rubles of additional profit, which lay in banks and waited in the wings, could be directed precisely to investment in processing, the expert says.