Russian Investment Unexpecetdly Contracts in JuneScott Rose and Olga Tanas
Russian fixed-capital investment unexpectedly fell the most since February 2010, adding to signs that the economy is failing to gain momentum.
Investment dropped 3.7 percent in June from a year earlier, the Federal Statistics Service in Moscow said by e-mail today. The median estimate of 16 economists in a Bloomberg survey was for a 0.5 percent increase. Unemployment also unexpectedly rose to 5.4 percent from 5.2 percent in May.
Economic growth in the world’s largest energy exporter is stumbling to the weakest pace since a 2009 contraction as the European Union struggles to exit a recession and China’s slowdown saps demand for Russian exports of oil, gas and metals. Russia, which is preparing to welcome Group of 20 finance chiefs for a summit in Moscow this week, has put the issue of long-term investment as a source of growth on the agenda for its G-20 presidency.
“Data holding near May’s levels suggest the economy remains weak,” Maxim Oreshkin, chief economist for Russia at VTB Capital in Moscow, said by phone before the release.
Retail-sales growth accelerated 3.5 percent in June from a year earlier, matching the median estimate 16 economists in a Bloomberg survey. That compares with a 2.9 percent gain in May, the smallest in more than three years. Receipts at merchants rose 1.9 percent on the month, also matching forecasts, the statistics service said.
Consumer-oriented companies have outperformed Russia’s broader stock index as rising real wages and consumer lending have helped spur the household consumption that accounts for about half of the economy. Grocery operator OAO Magnit has advanced 52 percent this year, while smaller rival Dixy Group is up 21 percent. The Micex Index of 50 stocks is down 3.8 percent in 2013.
Real wages rose 6 percent in June from a year earlier, the statistics service said. Real disposable incomes advanced 2.2 percent. Both increases topped economists forecasts’ in Bloomberg’s surveys.