The Lastest Macroeconomic News
12.05.2022 14:43 Inflation in Russia slowed down in early May
For the second week in a row, inflation has been lowering in Russia. So for 7 days before May 6, the figure was only 0.12% - the minimum value since the beginning of the year. Such data are provided by Rosstat. The decrease in inflation is associated with sluggish consumer demand, which is negatively affected by uncertainty and sanctions. The prices of some vegetables, such as cucumbers and cabbage, as well as chicken eggs, have fallen. A week earlier, the value of inflation was almost twice as high - 0.21%. The Bank of Russia is phasing out the emergency interest rate hike it made to support the ruble following the imposition of tough economic and financial sanctions by the US and its allies over the events in Ukraine. The key rate was cut to 14% from 17% at the end of April to ease the situation for the economy, which is already in a recession.
12.04.2022 14:47 The World Bank predicts the contraction of the Russian economy in 2022
According to a new World Bank (WB) report published on April 10, Russia`s economy will shrink by 11.2% in 2022 amid economic sanctions imposed against the country. In 2023 and 2024, it is projected to increase by 0.6% and 1.3%, respectively. Investment in Russia will fall by 16.9%, exports of services and goods will fall by 30%, imports will decline even more, by 35.2% year on year. Consumer inflation will be 22%, and the number of people living below the poverty line will increase from 11% to 12.8%. In 2021, Russia`s GDP growth reached 4.7% after declining by 2.7% in 2020. The state budget returned to a surplus of 0.8% of GDP. The current account surplus widened to $120 billion, higher than in 2019, as commodity prices rose and outbound tourism remained subdued. By the end of 2021, the main concern was consumer price inflation, which reached 8.4% year-on-year in December.
10.04.2022 20:48 The Central Bank of the Russian Federation strengthened the ruble and lowered the key rate to 17%
The Central Bank of the Russian Federation unexpectedly cut its key interest rate from 20% to 17% on April 8, although a meeting of the policy council was scheduled for April 29, as the regulator returned the Russian ruble to the levels at which it traded in the first half of February. The exchange rate of the ruble is extremely important, as the ratio of the ruble to the US dollar remains the economic indicator most closely followed by ordinary Russians. On the other hand, the stable exchange rate of the ruble helps to demonstrate invincibility in the face of Western sanctions.
07.04.2022 15:27 Business activity in the Russian sector of services and industry decreased in March
The seasonally adjusted S&P Global Russia Services PMI Business Activity Index plummeted to 38.1 in March, down from 52.1 in February - the biggest fall since the PMI index crashed at the start of the coronavirus (COVID-19) pandemic, S&P said in a press release on April 5. The seasonally adjusted S&P Global Russia PMI posted 44.1 in March, down from 48.6 in February, and below the 50.0 no-change mark, indicating contraction. The collapse in the service sector also dragged down the S&P Global Russia Composite PMI Output Index to 37.7 in March from a breakeven 50.8 in February. Any result below the no-change level of 50 is a contraction.
02.04.2022 17:06 Russian banking system and ruble recover despite Western sanctions
The Russian banking system and national currency have recovered in recent days after being hit by sanctions. This became possible due to the preservation of energy exports and the introduction of foreign exchange controls in order to protect the domestic economy. The ruble approached its value in the first half of February. Analysts say the situation is stabilizing as panic subsides. The recovery was made possible by the severe restrictions that the Central Bank of the Russian Federation imposed on currency exchange, withdrawals and transfers of hard currency abroad. But it also has to do with a very real factor still working in Russia`s favor: the persistence of gas and oil exports amid declining imports.
27.03.2022 19:47 Economists TD Bank lowered their forecast for global economic growth in 2022
Economists TD Bank in mid-March lowered their economic forecasts, referring to the situation in Ukraine and the subsequent impact on world commodity prices. They predict the growth of global GDP this year at the level of 3.9% compared with their previous forecast of 4.7%. Also lowered the forecast for 2023 from 3.7% to 3.4%. The forecast states that the situation in Ukraine and the accompanying shock of energy prices, food and other goods are the main factor in lowering the forecast in Europe. Soft growth in the winter months against the background of the distribution of OMICRON COVID-19 version also affected the transfer for 2022.
21.03.2022 13:27 The head of the Central Bank of Russia predicts an economic downturn and talks about the measures taken
The head of the Russian Central Bank, Elvira Nabiullina, said on Friday, March 21, that the country`s economy will contract in the coming quarters, and inflation will jump as sanctions imposed due to events in Ukraine have an impact on the economic situation. Earlier, the board of directors of the bank left the interest rate at 20 percent. The bank said that the doubling of interest rates on February 28 from 9.5% and capital controls to limit the movement of money have helped maintain financial stability in Russia and stem uncontrolled price increases. But the latest inflation data shows that as of March 11, prices in Russia were up 12.5% from a year ago. The Central Bank expects that the inflation target of 4% will be reached no earlier than 2024.
24.01.2022 14:57 Kaluga Automobile Electrical Equipment Plant will attract 132 million rubles from CentroCredit Bank
Centrocredit Bank will soon become a major creditor of PJSC Kaluga Automobile Electrical Equipment Plant (KZAE). Recently, the Board of Directors of the plant decided to apply to the bank and raise 132 million rubles in order to refinance the existing debt and maintain an acceptable level of working capital. This is stated in the official message published on the plant`s website. One of the goals of attracting a loan is the payment of debts on previous loans. The above amount should help the company pay off creditors. In addition, the funds will be used to pay the debt under the novation agreement. The remaining amount is planned to be used in settlements with suppliers of equipment, materials and components.
20.01.2022 21:47 The number of microloans issued in Russia hit a record high in 2021
The past year 2021 turned out to be fruitful for microfinance organizations. Russian citizens took small loans even more willingly than a year earlier. In particular, in the 3rd quarter of 2021, the total portfolio of microloans reached RUB 306 billion, an increase of 6% compared to the same period in 2020. It is noteworthy that with an increase in the number of microloans and the average amount issued, the number of overdue debts did not increase.
Experts note that the growth of this sector of the economy was due to a decrease in real incomes of citizens. At the same time, an increasing number of people lived in a paycheck-to-paycheck regime, and in the event of unforeseen expenses, they fell into difficult financial situations. Against this background, loans from MFIs have become a real salvation. The movement of borrowers from banks towards microloans was stimulated by a decrease in interest as a result of the actions of the Central Bank of the Russian Federation, an increase in the loan term, as well as the simplicity and accessibility of registration.
20.01.2022 16:39 CentroCredit Bank opened access to the SPB Exchange for its clients
At the end of December 2021, Centrocredit Bank provided its clients with the opportunity to trade foreign securities on the St. Petersburg Stock Exchange and for this purpose launched a special Online tariff plan, which involves a commission of only 0.01%. The IT-specialists of the bank implemented the possibility of opening a brokerage account remotely, which became a convenient addition to the offer. As part of the offer, leveraged trading is available for traders, as a result of which clients have the opportunity to buy shares for an amount greater than the funds deposited. High liquidity, the ability to purchase securities of companies from sectors that are not in Russia, risk management, as well as competent diversification of investments and optimization of the investment portfolio - such opportunities are provided to clients by trading in shares of foreign companies on the SPB Exchange.