Russian Economy Plunges as Oil Prices Collapse
Russia’s economy shrank the most since 2009 after a currency crisis jolted consumer demand, while a selloff in oil threatens to drag the country into a deeper recession.
Gross domestic product contracted 4.6 percent in the second quarter from a year earlier after a 2.2 percent decline in the previous three months, the Federal Statistics Service in Moscow said on Monday, citing preliminary data. That was worse than the median forecast for a 4.5 percent slump in a Bloomberg survey of 18 analysts. The Economy Ministry had projected that output shrank 4.4 percent in the period, calling it “the lowest point” for Russia.
The rout on commodities markets has overshadowed the firstsigns of stabilization in Russia by hammering the ruble and shaking a country that relies on oil and gas for about half of its budget revenue. The world’s biggest energy exporter is enduring its first recession in six years after the nation’s biggest currency crisis since 1998 and a surge in inflation eroded consumer buying power as sanctions over Ukraine choked access to capital markets.
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