Russian economy ministry improves 2023 GDP growth forecast

Russian economy ministry improves 2023 GDP growth forecast

14 Apr    Finance News, PMN Business, REU

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MOSCOW — Russia’s economy ministry revised higher its 2023 gross domestic product (GDP) forecast on Friday to growth of 1.2% from a contraction of 0.8%, news agencies reported.

The International Monetary Fund this week also raised its forecast for Russia’s 2023 economic growth, but said the country may see a sharply wider budget deficit and a smaller current account surplus this year. It said Russia’s global isolation and lower energy revenues could dampen its economic growth potential for years.

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The economy ministry lowered its rouble rate forecast to 76.5 to the dollar in 2023, from 68.3 in the previous forecast made last autumn.

The rouble is down around 10% year-to-date, making it the third-worst performer among global currencies so far this year as it struggles under the weight of a Western oil price cap and shrinking export revenues.

Russia’s economy defied early expectations for a double-digit economic contraction in 2022, in forecasts made soon after Moscow sent troops into Ukraine last February, but a return to prosperity remains far off as the government directs more spending towards the military.

The economy shrank 2.1% in 2022. Before Russia began what it calls a “special military operation” in Ukraine, the government had expected 3% growth. (Reporting by Reuters, Darya Korsunskaya and Alexander Marrow Editing by Gareth Jones and Barbara Lewis)

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