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Signs of nascent economic recovery emerge in June

28 July 2020
News

In June 2020, a recovery in business activity was increasingly evident in the national economy, helped by weakened restrictive measures combined with fiscal measures to support households and the corporate sector. These are the findings of the new issue of ‘Economy’, an information and analytical commentary.

Negative growth decelerated in industrial output and freight turnover. Signs of a rebound emerged in the construction sector. Growth in the agricultural sector continued.

Consumer activity strengthened markedly, with retail sales expanding both in the food and non-food sectors. Multiple indirect indicators suggested the emergence of a recovery in investment demand.

At the same time, tension in the labour market persisted. Declining household incomes and partially lifted restrictions on service sector operations will combine with weak external demand to constrain business activity growth throughout 2020. The Bank of Russia expects GDP to decline 4.5-5.5% in 2020. Aggregate demand is set to sustain its disinflationary pressure on consumer price movements.

Preview photo: Evgeny Razumny / Vedomosti TASS
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