[Economics] IMF and JPMorgan with more optimistic outlook on Russian economy

[#Wittels-]

The International Monetary Fund will change one of the most optimistic views on the Russian economy this year, despite the sanctions imposed on it for the invasion of Ukraine.

Bloomberg) -- The International Monetary Fund will reverse one of its most optimistic views on the Russian economy this year, despite sanctions imposed on it over the invasion of Ukraine.

An improvement to 0.7% in the latest IMF projections means Russia upset one of the biggest upward revisions among major economies to the fund's outlook in January, when it projected gross domestic product would expand 0.3%. in 2023.

JPMorgan Chase & Co. is the only one forecasting a stronger rally this year, to 1%, according to estimates compiled by Bloomberg. The median forecast is for a contraction of 1.7%.

“They have been able to keep quite a bit of momentum in the economy by taking, for example, very strong fiscal measures,” IMF chief economist Pierre-Olivier Gourinchas told reporters in Washington. "And so far they've been pretty resilient on the export revenue side as well, although we do anticipate that this will slow down."

 

To temper optimism, the IMF said the outlook for Russia is bleaker beyond this year. Although it anticipates GDP expanding 1.3% in 2024, the fund's latest bet represents a 0.8 percentage point downturn since January, among the world's worst revisions.

The economy contracted 2.1% last year, according to official figures, as rising commodity exports helped offset the impact of international sanctions. The decline was well below the 10% drop that some forecasts anticipated when punitive measures by the US and its allies were first imposed a little over a year ago.

Losses to the economy are likely to continue to grow in the coming years.

Russia's economy is on track to be 8% smaller by 2026 than it would have been if President Vladimir Putin had not ordered the attack on Ukraine in February 2022, according to Bloomberg Economics.

 

The IMF assessment is similar. It places the impact on GDP at around 7% by 2027 relative to its prewar trajectory.

“So the cumulative effect” from 2022 to 2024 “is quite strong,” Gourinchas said. By contrast, “most other economies are expected to recover and move closer to the pre-2022 forecast,” he said.

Original Note: The IMF only follows JPMorgan for the most optimistic view of the Russian economy

--With the collaboration of Harumi Ichikura.

 

Link: https://www.infobae.com/america/agencias/2023/04/14/fmi-y-jpmorgan-con-perspectiva-mas-optimista-sobre-economia-rusa/