Russian GDP falls, but trends vary widely across individual sectors

Recently revised Rosstat figures show that Russian GDP fell by 4.1 % y-o-y in the second quarter. The estimate for first quarter GDP growth remained unchanged at 3.5 %.

Economic growth trends varied wildly from branch to branch in the second quarter. Manufacturing value-added fell by 4 % y-o-y, while wholesale and retail sales were down by 14.1 %. Extractive industry value-added declined by 0.8 %. Construction activity was up by 3.4 % and public services grew by 5 %.

Second-quarter GDP (seasonally adjusted) contracted for the second consecutive quarter, falling by 1.9 % q-o-q. First-quarter GDP fell by 0.3 % q-o-q. The contraction of the Russian economy began well before the invasion of Ukraine as GDP level peaked in 2Q2021. The contraction in Russian GDP was much faster in the first half of this year than in 2014, when Western countries imposed sanctions of Russia e.g. for the illegal annexation of Crimea.

Russian GDP has declined this year

Sources: Macrobond, Rosstat and BOFIT.