PRIME NEWS@INSTAFOREX Source: mt5/ RUSSIAN OFFICIALS EXPECT TO ENTER RECESSION IN 2015 combination of oil prices in a bear market and the continuing effects of sanctions imposed on Russia have made the country’s officials predict that it will officially enter a recession in 2015 instead of the previously forecast growth of 1.2%. According to Alexei Vedev, the country’s Deputy Economy Minister, the gross domestic product of Russia will most likely shrink by 0.8% in 2015 in what is its first official forecast of a recession. The ministry also revised down its prediction for the average price of crude oil next year by $20 to a price per barrel of $80. Should the forecast be accurate, it would be the first recession for Russia since 2009 before it exited the global financial crisis that made its economy contract by 7.9%. Vedev said that, We now assume that sanctions will remain in place throughout the whole of 2015. This for us means closed capital markets for the majority of Russian companies and banks. Even if the sanctions are lifted it would take at least a year for its economy to return to normal levels, according to Maxim Oreshkin, the head of the finance ministry of Russia’s department for long term strategic planning. The economy ministry added that it now expects inflation to rise to 7.5% in 2015, up from its previous forecast of between 5% and 6%, while the finance ministry sees inflation to hold under 7%.
Posted on: Wed, 03 Dec 2014 07:15:57 +0000
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