The real economy, though, is in some ways a financial mirror image: it’s healthier than it seems at first glance. A weekly measure of consumer prices shows that they have risen more than 5% since the beginning of March alone. Many foreign companies have pulled out, reducing supply of goods, while a weaker currency and sanctions have made imports more expensive. However, the price of everything is not increasing. Vodka, primarily domestically produced, costs a little more than before the war. The price of petrol is almost the same. And although this is early days, there is still very little evidence of a major blow to economic activity.
Produced by and by an estimate based on Internet-search data OECDThink-tank of a rich country, Russia GDP The week of March 26th was about 5% higher than the previous year Collected by other “real-time” data Economist, Such as electricity consumption and rail loading of goods, are up. A cost tracker, produced by Sberbank, Russia’s largest lender, has grown slightly over the years. Part of that reflects the fact that people stockpile products before prices rise: the cost to household is particularly strong. However, the cost of services has dropped slightly and is much healthier in most epidemics.
Russia looks set to enter recession this year. But it could turn out badly in the end, as most economists have predicted. GDP Fall of 10-15% – depending on three factors. The first is that ordinary Russians began to worry about the economy as soon as the war broke out and cut spending – as happened in 2014, when Russia invaded Crimea. The second is whether imports from the West will eventually shut down production due to restrictions on companies’ access. Russia’s aviation sector is particularly vulnerable, as is the car industry. Yet many large businesses that began during the Soviet era are accustomed to operating without imports. If any economy can come close to dealing with isolation from the world, it will be Russia.
The third and most important factor relates to Russia’s fossil-fuel exports. Despite many sanctions, Russia still sells about $ 10 billion worth of oil a month to foreign buyers, equivalent to a quarter of its pre-war exports; Revenue from the sale of natural gas and other petroleum products is still flowing, too. It provides a valuable source of foreign exchange through which it can buy some consumer goods and parts from neutral or friendly countries. If this does not change, the Russian economy may reject the worst forecast. 3