Russia's first recession in a decade may have hit bottom, but the situation remains painful and growth will only return in 2010 thanks to a stable ruble and easing inflation, a poll of economists showed Friday.

The country is smarting from lower oil prices, falling demand for its exports and a global credit crunch that has left companies struggling to refinance foreign debt.

The economy will likely shrink 9 percent year on year in the current quarter -- only a marginal improvement from the 9.5 percent contraction seen in the first three months of the year.

"We may have reached the bottom, but we still remain there. Most likely the second quarter will also be tough," said Vladimir Osakovsky, analyst at UniCredit.

May's unemployment rate was seen hitting a fresh nine-year high of 10.3 percent, while the slowdown in retail sales accelerates to 6 percent year on year.

But the poll of 15 analysts also hinted at some green shoots of recovery, which could enable the economy to return to growth in the first quarter of next year.

The slowdown in industrial output was expected to moderate to 15.3 percent year on year this month, from a record 16.9 percent in April, while capital inflows resume for the first time since last summer.

"We think there are ... enough conditions for the situation to start improving. The government is now really trying to refocus on boosting lending," said Alexandra Yevtifyeva, an analyst at VTB Capital.

Commercial banks may be spurred to lend more to the real economy by further cuts in official interest rates, with the refinancing rate seen reduced to 11.5 percent by the end of June and 11 percent by end-September, from 12 percent currently.

Lower price pressures will give the Central Bank more scope to loosen monetary policy -- analysts slashed their 2009 inflation view to 10.8 percent from 13.8 percent a month ago.

They also became more convinced about the stability of the ruble, expecting it to end the year at 39.63 versus a euro/dollar basket -- not far off current levels -- against 40.43 forecast in April's poll.

"Falling inflation and the stability of the ruble are essential ingredients for the economy to begin to recover," said VTB's Yevtifyeva.

Overall, analysts remained more optimistic on the economy than the government, forecasting a contraction of 4.9 percent this year against the Economic Development Ministry's 6 percent prognosis.

"There is a vested interest in the ministry of economy to present a gloomier picture ... because this is a way for them to extract a bigger deficit from the government, and so more spending," said Ivan Tchakarov, economist at Nomura in London.