Russia is poised for an economic recovery after domestic cargo volumes, a leading indicator for growth, rebounded from the steepest slump since at least 2000, according to the survey by Bloomberg.
The CHART OF THE DAY shows the year-on-year change in an index of freight transport by rail, road, air and pipeline, rebounded from a record low in April. Economic growth extended annual declines through the first half.
“The recovery in cargo turnover provides more proof of an improving economic outlook,” said Georgy Tarakanov, Moscow- based analyst at VTB Capital, the investment-banking unit of Russia’s second-biggest lender. “The slump is easing and that is seen in the rising volumes of rail shipments.”
The economy shrank a record 10.9 percent in the second quarter from a year earlier, after declining 9.8 percent in the first, following 10 years of annual expansion averaging almost 7 percent. Domestic cargo volumes have rebounded 14 percent from a six-year low in April to 377.8 billion metric tons a kilometer (0.6 mile).
“The only accurate proxies that tell you the current state of affairs are railway cargo and power,” said Pavel Teplukhin, president of Troika Dialog, Russia’s oldest investment bank.
OAO Russian Railways, whose sales account for almost 3 percent of nominal gross domestic product, said cargo traffic advanced 2.5 percent in August from the previous month. The shipments fell 23 percent in the first half from a year before. The economy will contract 7.2 percent this year, according to the median estimate of 10 economists surveyed by Bloomberg.
The CHART OF THE DAY shows the year-on-year change in an index of freight transport by rail, road, air and pipeline, rebounded from a record low in April. Economic growth extended annual declines through the first half.
“The recovery in cargo turnover provides more proof of an improving economic outlook,” said Georgy Tarakanov, Moscow- based analyst at VTB Capital, the investment-banking unit of Russia’s second-biggest lender. “The slump is easing and that is seen in the rising volumes of rail shipments.”
The economy shrank a record 10.9 percent in the second quarter from a year earlier, after declining 9.8 percent in the first, following 10 years of annual expansion averaging almost 7 percent. Domestic cargo volumes have rebounded 14 percent from a six-year low in April to 377.8 billion metric tons a kilometer (0.6 mile).
“The only accurate proxies that tell you the current state of affairs are railway cargo and power,” said Pavel Teplukhin, president of Troika Dialog, Russia’s oldest investment bank.
OAO Russian Railways, whose sales account for almost 3 percent of nominal gross domestic product, said cargo traffic advanced 2.5 percent in August from the previous month. The shipments fell 23 percent in the first half from a year before. The economy will contract 7.2 percent this year, according to the median estimate of 10 economists surveyed by Bloomberg.