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Industrial Output Rises By 2.7%

Industrial production grew in December for a second month, the State Statistics Service said Friday, for the first consecutive increases in more than a year, which shows that the economy is recovering from its record contraction.

Output at factories, mines and utilities rose 2.7 percent from a year earlier, the most since September 2008, after a 1.5 percent advance in November, the statistics service said. Production grew a nonseasonally adjusted 5 percent on the month. The median estimate in a survey of 12 economists was for an annual increase of 3 percent and a 5.1 percent jump on the month.

Industrial production shrank 10.8 percent in 2009, the service said.

A record drop in stockpiles last year means that the pace of orders and production may accelerate as demand stabilizes. Central Bank interest rate cuts and government stimulus spending last month spurred gains in manufacturing.

The "macroeconomic outlook remains one of the most supportive in the world," UBS analysts led by Dmitry Vinogradov said in a Jan. 18 report. "While we are concerned about fiscal and monetary tightening in most countries, in Russia we expect monetary easing and continued support from the fiscal side."

Russian Railways, whose sales account for about 2.5 percent of gross domestic product, said cargo shipments rose 11 percent in December from a year earlier, as oil, coking coal and metals shipments rose. Rail shipments fell 15 percent in all of 2009.

Railroads account for about 85 percent of Russia's cargo transport, excluding pipelines.

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