If oil prices remain at $ 60 a barrel, the Russian economy experiencing its worst recession since 2009 writes Bloomberg.
Remains oil price of similar levels until the end of 2017, Russia’s GDP will fall back between 4.5 percent and 4.7 percent next year and 0.9 percent for 2016 .
It is the Russian central bank which bodes grim future image of the great country to the east.
Follow the developments in oil prices and Russia’s faltering economy our Equity Live.
The Russian ruble is now a record low. During the day it has weakened more than 8 percent against the dollar just today. At this writing, you must out with 64.3 rubles for one dollar. This is levels we must go back to 2009 to find equally.
Since the beginning of the Russian currency depreciated 48 percent against the dollar and 42 percent against the euro. The currently very weak Norwegian krone appreciated over 30 percent against the ruble.
Still tight monetary policy
The heavily oil-dependent Russian economy is also hard hit by Western sanctions, as a result of the crisis in Ukraine. Several Russian banks and industrial companies are prevented from retrieving money in the international financial markets, including oil giant Rosneft.
The central bank believes that inflation for December may reach 10.1 percent, and rise further to 11.5 percent in the first quarter, before the price growths begins to decline again.
– an inflation target of 4 percent is possible by the end of 2017, even if the external factors remain ufavorable. This requires that monetary policy remains tight throughout 2015, says Deputy Governor Ksenia Yudaeva.
Monday came also Russian industry figures, which showed that the country’s industrial production fell by 0.4 percent. This is the first time in ten months that the numbers coming in negative. Beforehand, it was expected a rise of 1.2 percent, writes Di.se.
The central bank has already raised its key rate five times since March, which last rate increase occurred last week. When selected central bank to turn up rate from 9.5 percent to 10.5 percent.
Second worst trading day
The Russian central bank is trying to prop up the ruble by giving new milliardlån, something that has not weighed against the other bad news for the bear in the east.
RTS index on the Moscow Stock Exchange had Monday its second worst day of the year. Unlike MICEX index denominated in rubles, reflects RTS index exchange value in dollars.
When the exchange closed Monday, the dollar index down 9.36 percent. In early March raging RTS index down 12 percent since the central bank raised its key interest rate to 7 percent and the situation in Ukraine was about to escalate.
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