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Recovery in Russia’s services sector held back by challenging epidemic situation

Meanwhile, high-frequency indicators suggest that the economy continued to grow in Q3 2021 albeit at a somewhat slower pace

MOSCOW, October 22. /TASS/. A recovery in Russia’s services sector is held back by the challenging epidemic situation, the Central Bank said in a press release following its board meeting on the key rate on Friday.

"Rapid growth in lending, one-off budget payments, rising real wages and households’ low propensity to save, driven by high inflation expectations, support expansion in consumer activity, especially in non-food markets. Growing domestic and external demand and high corporate profits shore up investment activity. A recovery in the services sector is held back by the challenging epidemic situation," the regulator said.

Meanwhile, high-frequency indicators suggest that the economy continued to grow in Q3 2021 albeit at a somewhat slower pace, the Central Bank noted. "Based on Bank of Russia estimates, this is largely associated with the return of the Russian economy to a balanced growth path. At the same time, a number of sectors are under increased pressure from supply-side constraints. Their restraining effect on business activity may strengthen against the background of tightened anti-pandemic measures," the press release said.

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