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Production Growth Slows

Industrial production grew at the slowest pace since October 2009 last month, as manufacturing and mining lost steam and unseasonably cold weather abated.

Production rose 2 percent from a year earlier, compared with a 6.5 percent increase in February, the federal statistics service in Moscow said Monday in an e-mailed statement. That's less than the 5 percent median estimate of 16 economists in a Bloomberg survey. Output grew 4 percent in the first quarter.

The Economic Development Ministry this month cut its forecast for 2012 economic growth to 3.4 percent from 3.7 percent as investment will be weaker than initially estimated and industrial production will expand 3.1 percent compared with an earlier 3.6 percent projection. Growth in utilities output eased to 1.3 percent in March after jumping 6.7 percent the previous month because of freezing temperatures, according to Benoit Anne, chief emerging market strategist at Societe Generale in London.

"Recent purchasing managers' indexes and other leading indicators — electricity consumption, rail-cargo transportation — have also been pointing to the softening sequential momentum in industrial production," Anne wrote Monday in an e-mailed note before the release. Industry growth rates will probably stabilize at a "moderate" 3.9 percent pace in the coming months, he added.

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