RT.com
14 May 2022, 18:13 GMT+10
The Wall Street bank predicts only a moderate recession due to sanctions
Russia's economy is coping better with Ukraine-related Western sanctions than could be expected, JPMorgan Chase said in a note to clients dated last week and made public on Monday.
According to the biggest US investment bank, business sentiment surveys from the country "are signaling a not very deep recession in Russia, and therefore imply upside risks to our growth forecasts." It also cited high-frequency indicators such as electricity consumption and financial flows, which signal that the economy is in better shape than predicted.
"The data at hand therefore do not point to an abrupt plunge in activity, at least for now," the bank's analysts state in the note, as cited by Business Insider.
JPMorgan also backtracked on its earlier forecasts of a 35% drop in Russian GDP in the second quarter and 7% for all of 2022, now saying the figures are likely to be much less alarming. The bank did, however, note that the impact of current and potential sanctions will be felt, and that the country's economy would be in far better shape if Moscow had not launched its military operation in Ukraine.
"The impact of sanctions will continue building in coming quarters, we expect. The GDP profile, therefore, looks increasingly likely to be consistent with a drawn-out, but not very sharp recession," the analysts predict, noting that export orders are showing a particular decline.
Russia has faced unprecedented economic restrictions since it launched a military operation in Ukraine, drawing intense condemnation from the West. The US has, among other measures, placed an embargo on Russian oil, one of the country's major export commodities, while the EU is currently preparing its sixth package of sanctions, and also considering an oil ban. Russia has been cut off from the SWIFT interbank messaging system, while banks, organizations and individuals have been sanctioned, and assets including half the country's forex reserves have been frozen. Russia has responded with countermeasures and managed to bring the national currency, the ruble, back to its pre-conflict level after a historic drop, but there is still much uncertainty among analysts as to the future of the economy.
For more stories on economy & finance visit RT's business section
(RT.com)
Get a daily dose of Malaysia Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Malaysia Sun.
More InformationSHAN STATE, Myanmar - According to an officer who participated in the assault, two local defense forces have destroyed a ...
DHAKA, Bangladesh - A senior Bangladeshi minister has floated a set of proposals that he believes will accelerate the implementation ...
KATHMANDU, Nepal - India's Prime Minister Narendra Modi will arrive in Nepal Monday on an official visit, leading an 11-member ...
TUNIS, Tunisia - The Tunisian navy said Saturday that it rescued 81 migrants, including 32 Bangladeshis, sailing from Libya to ...
KATHMANDU, Nepal - A retired Air Force colonel from the United States climbed the world's highest mountain on Friday morning, ...
ISLAMABAD, Pakistan - Prime Minister Shehbaz Sharif will visit Abu Dhabi Sunday to express condolences on the death of UAE ...
ROME, Italy: Italy has announced plans to sell state-owned ITA Airways, the successor to Alitalia, by the end of June, ...
SYDNEY, NSW, Australia - Stocks struggled for direction in Asia on Monday. Early gains evaporated later in the data, although ...
BEIJING, China: China's Green Valley Pharmaceutical company has prematurely ended an FDA approved study on its GV-971 to treat mild ...
SILAO, Mexico: U.S. automaker General Motors (GM) has agreed to raise wages by 8.5 percent, following negotiations with a new, ...
ZAGREB, Croatia: Croatian lawmakers have voted to allow the introduction of the euro currency in 2023. Lawmakers voted 117-13 to ...
TEHRAN, Iran: Iran has abruptly raised prices as much as 300 percent for a variety of staple foods, including cooking ...