The economy will grow a seasonally adjusted 2.3 percent in the fourth quarter, and pick up another 2.6 percent in the first quarter of 2010, according to a new leading indicator created by Renaissance Capital and the New Economic School.
“Year-on-year real GDP is expected to decline 5.7 percent this quarter and increase 6.4 percent in the first quarter of 2010,” Renaissance Capital said in a report presenting the indicator.
GDP will grow 2 percent quarter on quarter in the fourth quarter of 2009, Deputy Economic Development Minister Andrei Klepach said earlier this month, while the ministry forecasts 1.6 percent growth in 2010 year on year.
The indicator uses 108 official economic indexes, including consumer and producer price indexes, stock indexes, trade balance and oil prices, to forecast growth in GDP for the coming period.
Much of the data used in the indicator comes from the State Statistics Service, or Rosstat, part of the Economic Development Ministry. “We use Rosstat estimates on certain sectors and investment data. These are the things that are less affected by the political context,” said Konstantin Styrin, a professor at the New Economic School.
But the leading indicator will only make forecasts for the quarter ahead because the turbulent economy makes more distant forecasting impossible.
“The leading indicator is always one of the most-watched reference points for investors in developed economies, and I hope that this series will prove itself over time to be an accurate predictor of the trend in the Russian economy,” said Chris Weafer, chief strategist at UralSib. “It will, however, take about a year of observations for investors to know just how reliable it actually is.”
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