The International Monetary Fund said Russia’s economy will rebound this year after a two-year recession and inflation should slow to the central bank’s target amid diminished short-term risks from volatile oil prices and financial markets.
Russia’s economy should expand 1.4 percent this year, the Washington-based IMF said on May 19 at the conclusion of a regular meeting.
“The [Russian] economy is exiting a two-year recession that, thanks to the authorities’ effective policy response and the existence of robust buffers, proved shallower than past downturns,” the IMF said in a statement to conclude the mission.
Russia’s export-dependent economy fell into recession, defined as two consecutive quarters of contraction, in late 2014, several months after it annexed Crimea and was hit by Western sanctions coupled with falling prices for commodities, especially in the energy sector.
The IMF said inflation will slow to the central bank’s 4 percent target, driven by the ruble’s appreciation and continued weak consumer demand.
The IMF also called for better financial supervision, more efficient credit allocation, and further structural reforms, which it said could help the world’s largest country by area to secure future economic growth.