IMF still expects Russia’s GDP to grow 1.4% in 2017

MOSCOW, Jul 10 (PRIME) -- The International Monetary Fund (IMF) has maintained its Russia’s 2017 economic growth forecast at 1.4%, the fund said in a statement on Monday.

Stabilization of oil prices and improvement of financial conditions will support Russian GDP, which will also increase 1.4% in 2018. In 2016, the Russian economy stabilized with only a 0.2% contraction after a double shock of low oil prices and sanctions. The reaction to such large external shocks shows that the government policy is efficient, the fund said.

Low production dynamics, weak consumer demand, low food prices thanks to a good harvest and strengthening of the ruble will push inflation toward the central bank’s 4% target by the end of 2017. The IMF recommended the regulator continue a gradual softening of the monetary policy.

Russia should cut dependency on oil prices and initiate structural reforms to support new sources of growth and to bring income per capita to the level of developed states, the fund said.

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