George Glover – Yahoo Finance Aug 28, 2022
- Top investment banks expected Russia to suffer severe economic damage after it invaded Ukraine in February.
- But Russia’s economy has held up better than expected, causing them to revise those predictions.
- Here are three charts that show the Russian economy’s resilience in the six months since war started.
When President Vladimir Putin’s forces invaded Ukraine in late February, many Wall Street analysts rushed to predict Russia’s economic downfall. Six months later, they’ve been forced to revise those forecasts.
Those dire warnings looked set to become reality in the weeks after war broke out. Western allies brought in economic sanctions — such as oil import bans and cutting the Russian ruble out of international currency markets.
But Russia’s economy has shown a lot of resilience. These three charts show how.
Economic growth holds up
In March, top investment bank JPMorgan said Russia’s gross domestic product would fall 35% in the second quarter compared with the previous. Goldman Sachs predicted its economy would suffer its worst contraction since the Soviet Union imploded in the early 1990s.
But Russia’s GDP slipped only 4% year-on-year in the three months to June 30. In fact, its economic growth shrank at a faster rate after the coronavirus pandemic broke out, when GDP fell 7.4% in the second quarter of 2020.
Given that, JPMorgan has concluded Russia’s economy has held up under the weight of tough sanctions.
Available data “does not point to an abrupt plunge in activity — at least for now,” its strategists said in a note recently. “The GDP profile, therefore, looks increasingly likely to be consistent with a drawn-out, but not very sharp recession.”
Stronger-than-expected exports of Russian commodities, including crude oil, has helped support the economy. The country has also benefited from robust demand among its own consumers and a Kremlin-devised program to keep unemployment low, according to the International Monetary Fund.
“Domestic demand is showing some resilience thanks to containment of the effect of the sanctions on the domestic financial sector and a lower-than-anticipated weakening of the labor market,” the IMF said in July.
Oil exports boosted by Asia pivot
Wall Street analysts also predicted that Western oil import bans would badly hurt Russia, the world’s third-largest oil producer behind the US and Saudi Arabia.
Its economy is heavily reliant on its energy exports, with oil and gas revenues making up 45% of its federal budget last year, according to the International Energy Agency.
The US put an embargo on Russian energy imports in March, while the EU agreed a phased ban — which for now impacts 75% of Russian oil purchases — in May.
In March, Goldman Sachs said Moscow was unlikely to find other crude oil trading partners, given its expulsion from the SWIFT banking system prevented the Russian Central Bank from using its foreign reserves.
“Illustrating this point, there are no reports of increased Chinese purchases of Russian crude so far, with China similarly not scaling up imports of Iranian or Venezuelan crude in recent years,” its analysts said.
But Russia still exports 7.4 million barrels of its oil each day, according to Bloomberg data for July.
India’s purchases of Russian oil have played a big part. Its imports rose five months in a row before slipping slightly in June. It’s still taking in 1 million barrels of Russian oil a day — a 900% increase from February.
And Europe has yet failed to wean itself off of Russian crude. The EU still brings in 2.8 million barrels a day, according to Bloomberg data. That’s just a 30% drop from February’s 4 million barrels a day.
Factory and services activity revives
Wall Street saw nothing but pain ahead for Russia’s manufacturing and services sectors as Western economic sanctions hit.
In the wake of the Ukraine invasion, Russia’s composite Purchasing Managers Index — which tracks trends in the two sectors — tumbled. It slid from 50.8 in February to 37.7 in March, with a reading above 50 indicating growth and below 50, contraction.
Goldman Sachs strategists said the contraction was “broad-based, with sharp drops in the output, new orders, and especially the new exports orders components”. They noted Moscow should brace for further declines.
But several months later, Russia’s composite PMI has risen back into growth territory.
The index climbed to 44.4 in April, rose above 50 in June, and hit 52.2 last month. That last reading means Russia’s economic health is blooming -—a far cry from the predictions of doom made on Wall Street.
The international gangsters started this war to get their grubby hands on Russian assets its not worked out its just brought ruin to Europe. Farage has said we are facing a new Weimar Republic and he’s worried what that will bring well where did he think international capitalism was going to take us ? As long as we keep imbeciles like the Ukrazies out of the equation this will be the perfect opportunity for real nationalism to take over
Russia falling is wishful thinking in the Scum but it might be White people’s hard core
Wall Street “Experts”….. 😅😂😆🤣
Since when have the big banks been dealing with reality?
It’s on record that Goldman Sachs puts out different advice based on the grading of their clients, & JP Morgan does the same, they all do it, because just like the bookies, most need to lose their money, or more usually their debt based investments.
The NWO and any facet of the sect, has either though ignorance, or denial, has underestimated the true size and complexity of the Russian economy. China ain’t best mates with Russia because of Evil Uncle Sam. China knows that Russia has all that it needs in terms of resources, and these can be delieved by land, or through Arctic Sea lanes.
Russia hasn’t even started with serious sanctions on the NWO sect. Russia could collapse the West in less than one year. Most titanium comes from Russia, so good by Boeing, good by most US defence manufacturers, and that’s just one resource. The list of materials which come from Russia, is far too long to list here.
Russia has virtually no debt, their sovereign funds are actually growing, and I read the other an article by a NWO financier who stated that Russia could turn off everything for 12 months, before the Russians would start to feel it.
Why the feck would Wall Street and City banks know reality? They’ve had the Fed, BoE, BoJ, and the ECB, printing vast quantities of debt and buying worthless corporate stocks, just to the bust banks look like they’re in business.
I had a good laff yesterday, when the Fail had a story suggesting that due to the CoLC, house prices could fall 7%, only 7%, fecking hilarious, but that’s just a number, add inflation. My guess, property prices could tumble, but it won’t happen, because the banks will slow lending to a trickle so no one can sell, and thus, no one can buy, so its like hibernation, or like suspending the trading of a particular share on the stock market.
If we avoid nuclear war and the delights of bankrupt Britain being Sarmatted off the face of the Earth, here’s hoping. They will bring in massive debt cancellations. The thicko sheeple, on their fecking knees will go, ‘oh yes, thankyou Lizz! But the thicko sheeple won’t have a clue or care, that while the stupid sheeple with their enormous debts, this pales in comparison to bank, state, & corporate debts. Remember, they don’t want to fix the system. They just want happy thicko sheeple so they can carryon with their ponzi schemes.
Then we will see a NWO currency. Probably no cash, and total surveillance. But thicko sheeple won’t care, their debts gone, for a short while.
This is assuming there’s no nuclear war, or multiple bioweapon releases, or both. I don’t think the sect has decided. I think they’re still in the headlights phase, shocked by their stupid underestimation of Russian fortitude. And the real irony, is that Putin just wanted Russia to be a successful player in the world economy, and a handful of infantile thickos at MI6, who just couldn’t tolerate another country enjoying the fruits of their labour.
Little Island complex! lol
The only thing that makes this narrative work is that the Cold War was exactly what it appeared to be…
To whatever extent the Cold War was not what it appeared to be, then George Patton’s death was necessary for the transition from OSS to CIA…
The OSS was to WW2 what NASA was to the moon-landing…
Communism was to Russia what North Korea is to the CCP—-inconsequential in the orchestrated “music of the spheres”.
You see, the emperor with no clothes expected Russia’s economy to collapse, which would, the emperor hoped force a friendly, liberal pro-western Russian populace to demand regime change.
News for the emperor. Russia’s populace is not liberal and not pro-western and if regime change was to occur the new Russian leader would be a lot less patient with the emperor than Putin has been.
The stage on which emperor is performing is also getting smaller with India rolling up her welcome mat and leaving the shit show.
it goes to show that one cannot place confidence in economists. Russia dumped all its us treasuries and paid off its debt ensure an easier economic life. the fact that Russia told europe and the west that they will now have to pay in rubles was a master stroke thus bypassing swift and ensuring and an ever increasing positive current account balance. secondly that exporting oil at a huge discount to the near and far east and settling trade in their own currencies was another master stroke, who then traded this oil at premium price to the west. in essence sanctions have failed and the boot is now on the other foot. europe will have suffer the consequences of following usa diktats and enjoy a freezing winter, fall in output and recession staring them in the face. well done europe and the west – one cannot make up this foolhardiness
This just shows the old adage is still working. If the West says something, the opposite is sure to play out. Happens almost every time. It’s just about the only thing one can depend on these days.
Yeah right, Wall Street/USA & Russia are both on the same team: the Jew team. Like I said before, nothing will happen to your precious Commies & Jew ridden Russian government, since NATO & Russia are all in on it together. Those supposed sanctions are a fantasy–they don’t exist except on some TV newscasters script. We know that virtually all the cabinet posts in the Biden Admin are permeated with Jews, but what TTS & the MSM doesn’t tell you is that the Putin Cabinet is suffused with Semites too: Just a few of these mongrels names: Nabulliana, Siluanov, Shoigu, Lavrov, Mishustin, Shadayev..many more…Strange, it looks like Antifa America & Antifa Russia are surreptitiously governed by the same transnational cult of Zionist-Communist Cryptocrats– managed by anti-white Jewish-Commie lunatics, colluding together to slaughter thousands/millions of Aryan Ukrainians & furtively advance their WEF policies. Now you know what the actual setup is.
Nico X–someone else made the point recently that if Ukraine were Germanic it would be dynamic, rich, high-tech, busy, cultured, civilised (my words), but it is none of that. Its Eastern half is the Western half of Khazaria, with some Turk, Mongol, Viking, Russian, a big mix
Wall Street is only used to working with phony figures. Give them straight figures and they’ll bend them, they can’t help it. There are lies, damn lies, and then there’s statistics. Then there’s Wall Street numbers.
@lewis jones..Ukraine has been under Jewish control since 1917. I never said it was a 100% Teutonic; but there’s more Germanic stock in Ukraine than in Russia– the latter being primarily a Slavic-Mongol mix..
I’ve never looked forward to a winter more in my life than the coming one. I can’t wait to see the predictable unrest, especially among the poor migrants they imported to replace whites with.
I have to tip my hat to the diabolical geniuses in America that knew this would be worse for resource dependent Europe than for the US.
Wall Street predicted Russia’s economy would collapse after it invaded Ukraine….
& US/EU economy will quintuple !
Trust me ? Would I lie to you ??
Russia is broke .. Russia is broke .. Russia is broke .. Russia is broke .. Repeat after me, Russia is broke .. Russia need Western expertise .. Russia’s economy is one tenth of Kalifornia’s economy ..
As reported by your respected WSJ & CNNNBCCBCBBCABC….