Hot summer 2023: Russian GDP rises again in June

By Alexander Ivanter

In June, Russian GDP grew by 0.1% after 1.5% in May with seasonal and calendar components excluded, the VEB.RF Institute estimated. This was the fourth month of consistent growth in the economy, as a result of which GDP came close to the pre-crisis maximum of December 2021.

Compared to the corresponding period last year, GDP increased by 5.7% after 5.6% in the previous month, and in general, for the first half of the year, GDP growth by January-June 2022 amounted to 1.6% (estimated by the Ministry of Economic Development - 1.4% ).

In June, agriculture (0.2%), mining (0.5%), retail trade (0.8%), wholesale trade (1.0%) and net taxes on products (0. 2%). At the same time, manufacturing industries (-1.0%), production of electricity, gas and water (-0.2%), passenger transportation (-1.7%), public catering (-0.7%) worked in the red. and paid services (-0.7%). The seasonally excluded freight turnover remained at the level of the previous month. Construction showed the strongest decline in June - minus 2.8% compared to the previous month.

Retail sales remain one of the main drivers of growth this year, VEB.RF Institute comments on its calculations. Following retail trade, wholesale sales increased in June due to trade in pharmaceutical products, as well as machinery and equipment. Against the backdrop of sustained growth in domestic demand, mineral extraction increased in June. At the same time, a number of key sectors that showed rapid growth in previous months showed a decline in June. So, for example, processing has decreased after the intensive growth that began at the end of last year. First of all, the dynamics of machine-building industries corrected, which had been steadily growing for six months in a row. The biggest decline was in the production of motor vehicles as a result of a three-week shutdown of AvtoVAZ. In general, GDP grew unexpectedly strongly in the second quarter. In relation to the first quarter, the growth was 1.9%.

In early August, the head of the Ministry of Economic Development, Maxim Reshetnikov, said that by the end of 2023, the Russian economy would grow by “more than 2%” (with the latest official forecast of the Ministry of Economic Development from April of this year - 1.2%). The Central Bank also revised its GDP growth forecast strongly upwards. If in February he estimated the economic dynamics in the range from one percent decline to one percent growth, then the current fork of the forecast is from 0.5 to 2%.
This article originally appeared in Russian at expert.ru