Growth in economic activity in Russia persists in Q3 2026, but slows somewhat compared to Q2 - CBR analysts

MOSCOW. Oct 14 (Interfax) - Economic activity in Russia continued to grow at a moderate pace in Q3 2026, but slowed somewhat compared to growth in Q2, according to the Talking Trends bulletin prepared by the Central Bank of Russia's Research and Forecasting Department.

"Macroeconomic statistics for July-August point to moderate growth in economic activity compared to Q2 (adjusted for seasonal factors). As before, growth is characterized by high heterogeneity across sectors of the economy, especially in manufacturing. The continued growth in coal mining and the group of investment industries and a decline in the production of consumer goods alongside a decline in retail trade is noteworthy. At the same time, the segment of public catering and paid services continues to grow, which may reflect changes in the structure of household consumption," the CBR said.

"The GDP growth rate adjusted for seasonality slowed in Q3 after active recovery growth in Q2," it said.

"A significant part of the slowdown in growth in Q3 was caused by a temporary decline in the economy's production potential. The slowdown in domestic demand was less pronounced than the slowdown in overall economic growth. As production capacities recover, economic growth rates will increase," the Central Bank said.

"The reduction in production capabilities (a supply shock) affected mainly intermediate industries, primarily oil refining. The decline in fuel output levels had an indirect negative impact on the dynamics of extraction, transport and wholesale trade. At the same time, investment industries maintained a trend of active growth, including thanks to government procurement. An additional impulse to economic dynamics in recent months was given by increased activity in the construction and transport industries, linked to the repair and protection of infrastructure facilities, as well as the partial redirection of export supplies along longer logistics chains," the CBR said.

As reported, in September, the Economic Development Ministry raised its forecast for Russia's GDP growth in 2026 to 0.6% from 0.4% in the May version of its forecast.

In July, the CBR lowered its forecast for Russian economic growth in 2026 to 0.0%-1.0% from 0.5%-1.5% in the previous, April version.

Analysts surveyed by Interfax in early October forecast GDP growth in 2026 at 0.5%.

Analysts expect the Russian economy to grow 1.1% in 2027, which is slightly below the expectations of the Economic Development Ministry (growth of 1.4%) and the CBR forecast (1.5%-2.5%).