(Bloomberg) — Russia’s economy continued to rebound from its pandemic-induced recession in the fourth quarter of 2020, easing its contraction as President Vladimir Putin opted against imposing a second national lockdown.
Gross domestic product declined 1.8% from a year ago, the Federal Statistics Service said Thursday. That was less than the median forecast of economists for a drop of 2.2%. The full-year contraction was revised to 3% from 3.1%, the service said, also updating previous quarters.
The economy of the world’s largest energy exporter contracted less than many of its peers last year as Russia imposed lighter Covid-19 restrictions following an initial lockdown. Its service sector is also relatively small as a share of output.
Inflation, sparked by rising global food prices and the ruble’s weakness, accelerated further amid a recovery in consumption, prompting the Bank of Russia to raise interest rates for the first time since 2018 last month, with further hikes likely.
The government will lower its 2021 economic growth forecast from 3.3% after the statistics service’s report of a smaller contraction last year, Economy Minister Maxim Reshetnikov said Thursday, according to Interfax. Performance in the first quarter should be on par with the last three months of 2020, he said.