Russia's economy expanded by 1.6 percent in the first quarter, the Federal Statistics Office confirmed Monday, giving a breakdown of production that showed a sharp decline in output of mineral resources.
The first quarter growth rate was the slowest since 2009 and represented a decline in year-on-year growth from 3.4 percent in last year as a whole.
Resource extraction which encompasses oil, gas, coal and metals declined by 4.9 percent, year on year, confirming anecdotal evidence that Russia's metallurgical sector is having a rough time as demand and prices slide.
The soft patch in Russia's $2 trillion economy has forced the government to revise down its full-year growth forecast by a third to 2.4 percent, but policy makers have yet to take any meaningful steps to stimulate growth.
President Vladimir Putin, in a budget strategy address last week, urged the government to focus on top-priority development projects but said Russia would not be able to keep raising public spending for ever.
Calls have also mounted for lower interest rates to give the economy a lift, and with Putin's economic adviser Elvira Nabiullina to take the helm of the Central Bank an interest rate cut could come as soon as next month, economists say.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
