Morgan Stanley improves outlook for Russian econ in 2016–2017

MOSCOW, Jul 18 (PRIME) -- Morgan Stanley has improved the forecast for Russia’s real gross domestic product (GDP) dynamics in 2016 to a 0.6% contraction from a 2.1% fall projected earlier, the bank said in a statement on Monday.

The bank also improved the forecast for 2017 and now expects Russia’s GDP to grow 1.4% instead of 0.9% projected earlier.

The Russian economy will continue to be in a recession in July–September 2016 and will start to increase in October–December 2016, the bank said.

Annual inflation is expected to amount to 6.1% by the end of 2016 and 5.4% by the end of 2017. The central bank could reduce the key rate to 9.5% later this year and to 7.5% by the end of 2017.

Morgan Stanley attributed the improvement of its forecasts to an oil price increase. The average Urals price is expected at $43 per barrel in 2016 and $50 in 2017, the bank said.

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