FX.co ★ Russia reports surprise Q3 GDP growth

International market watchers have mixed viewpoints on Russia’s economy. Some of them do not share an optimistic outlook. Nevertheless, experts of Fitch Ratings believe in positive prospects of Russia’s economy.

The reputable rating agency upgraded the outlook on the back of positive trends in a variety of metrics. The crucial argument was a strong GDP rate for Q3. The domestic economy expanded 1.7% in annual terms beyond expectations.

Another convincing factor was an increase in retail sales. Besides, Fitch experts noted that both the manufacturing and construction sectors had gained momentum. The rating agency thinks that both sectors can rely on extra subsidies from the government in the final quarter of 2019.

At the same time, analysts downgraded the forecast of inflation for Q4 2019 and the next year. They project consumer inflation to rise to 3,5% and 3.8% respectively. Fitch Ratings reckons that inflation in Russia will remain at around the target level of 4% in 2021.