Russia's economic growth to slow by half in the second half of the year - Bloomberg

In the second half of 2024, the growth rate of the Russian economy is likely to slow by half. This is evidenced by a survey of economists conducted by Bloomberg, UNN reports.

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According to Bloomberg, the overheated Russian economy is beginning to slow down sharply.

According to economists surveyed by Bloomberg, gross domestic product will jump by more than 4% in the second quarter, but the growth rate is likely to slow by half over the rest of the year.

Bloomberg writes that since the invasion in February 2022, the Russian government has sharply increased spending, pouring money into the military and defense industry and trying to mitigate the effects of sanctions imposed by the United States and the European Union on domestic enterprises.

According to the head of the Bank of Russia, Elvira Nabiullina, in response to the huge growth in domestic demand, the economy has overheated to a degree not seen since the global financial crisis of 2008.

"The reserves of labor and production capacity are almost exhausted," Nabiullina said.

Last month, the central bank raised its key interest rate by 200 basis points to 18%, the highest level since the first weeks of the war, to counter the risk of stagflation.

The unemployment rate, which is the main sign of overheating, has fallen to a historic low of 2.4% in Russia and is lower than in any of the G7 countries.

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