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October 11 2018

Central Bank reported anomalous drop in imports

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Central Bank reported anomalous drop in imports

The Central Bank reported a drop in imports in the third quarter compared to the same period last year. Experts interviewed by Vedomosti notice that imports have also declined in quarterly terms, and call the situation abnormal
The fall in imports of goods, which the Central Bank reported the day before, is anomalous. This conclusion was reached by experts interviewed by the Vedomosti newspaper. Last Tuesday, the regulator reported that imports for the third quarter fell to $ 63 billion from $ 63,8 billion in the same period a year earlier.
In particular, Oleg Solntsev from the Center for Macroeconomic Analysis and Short-Term Forecasting (CMASF) notes that imports are highly susceptible to seasonality and in the second half of the year it usually begins to grow at an accelerated rate. However, he notes, imports fell in annual terms and to the previous quarter, and calls this situation anomalous.
The expert noted that a similar situation, in which imports in the third quarter decreased in quarterly terms, was observed for the last time in 2014, at the height of the crisis. If these are not statistical errors, the markets "do not accept" imported goods, he warns.
Natalia Orlova, chief economist at Alfa Bank, pays attention to the unusual situation. In an interview with the publication, she noted that amid the growth of the economy, imports should traditionally grow. In her opinion, the fall in imports may portend a slowdown in final demand, as evidenced by the weak dynamics of stocks of enterprises in the second quarter. Another reason, she said, could be a drop in imports of investment goods due to the completion of large state construction projects, such as the Crimean Bridge.
The third interlocutor of Vedomosti, the director of the analytical department of Loko-invest, Kirill Tremasov, agrees with the previous experts. According to him, historically, a drop in imports was observed in times of crisis, when the ruble devalued and demand fell. So it was from the fourth quarter of 2013 on the second quarter of 2016, and before that - in 2009, he recalls. For the first time in modern history, imports fell, and exports grew rapidly. This is a consequence of suppressed domestic demand, both investment and consumer, the expert believes.


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