Russia Q1 GDP grew less than expected — Minister

Russia’s economy expanded by a less-than-expected one per cent in the first quarter of 2013, which is likely to force a cut in the growth forecast for the full year, Economy Minister Andrei Belousov said on Sunday.

“The results of the first quarter seem to be worse (than expected),” Belousov told journalists on the way to Hanover as part of an official visit, adding that growth in gross domestic product in the first quarter was probably around one per cent.

He said the ministry would cut the 2013 GDP forecast to below three per cent in a conservative scenario or to around 3.2 per cent in an optimistic one.

Reuters reported that the ministry had earlier estimated the economy was likely to grow by 3.6 per cent this year. It warned at the end of March that it would probably cut its GDP forecast for 2013.

“I can say for sure that in our (new) forecast for 2013 we will cut estimates for exports of natural gas, (and) investment estimates will be lowered. Consequently, the pace of GDP growth will also be lowered,” Belousov said.

President Vladimir Putin said inflation is likely to exceed 6.3 per cent this year, surpassing an economy ministry forecast of up to six per cent.

Putin spoke hours after Belousov said the ministry would keep its five to six per cent inflation forecast for the year, counting on a slowing rate in consumer price rises in the coming months. Annual inflation came in at seven per cent in March.

Source: Punchnews