Russian Economy Rebounds in Second Quarter Despite Ukrainian Strikes
Consumer activity drove the rebound, with retail turnover up 7.2% year over year, according to RBC, as growth beat official forecasts.
- On August 12, Rosstat reported Russia's GDP grew 1.3% in the second quarter of 2026, marking the strongest quarterly growth in six quarters and exceeding Central Bank and Economic Development Ministry forecasts.
- Following a 0.2% contraction in the first quarter, President Vladimir Putin demanded in April that economic officials take 'concrete measures' to restore growth and make it 'substantial' and 'sustainable.'
- Consumer activity drove the expansion, with retail turnover rising 7.2% year-over-year, though civilian manufacturing fell 3.2% from a year earlier and 4.6% compared with 2024 levels.
- Despite Ukrainian drone strikes on oil refineries that pushed refining volumes to their lowest level in two decades, growth persisted as the Central Bank maintained a 14% interest rate.
- Economist Liam Peach expects Russia to 'remain in a state of stagnation,' while Vladislav Inozemtsev warned that drone strikes are 'quite seriously undermining the Russian economy' alongside Kremlin tax policies.
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Russia's economy continues to weaken, production, domestic demand and investment slumped in July - in July 2026, the Russian economy deteriorated: oil and gas production fell by 9.3%, domestic demand grew by only 1.5%, and Investment fell by 2.1%. The decline was recorded in most regions.
Russian Economy Returns to Growth, but Economists Warn Rebound May Be Short-Lived
Russia’s economy returned to growth in the second quarter after contracting for the first time since 2023 at the start of the year, official data showed on Wednesday, outperforming government and Central Bank forecasts.
Russia’s GDP grew 1.3% in the second quarter of 2026, beating Central Bank and government forecasts
Russia’s gross domestic product (GDP) grew 1.3% in the second quarter of 2026 compared with the same period last year, according to preliminary data published by Russia’s official statistics agency, Rosstat, on August 12.
Russian economy rebounds in second quarter despite Ukrainian strikes
Russian gross domestic product (GDP) grew 1.3 percent in April-June, the statistics agency Rosstat said, after a 0.2 percent contraction in January-March. That growth exceeded the 0.9 percent forecast by Russia's economy ministry. In the second quarter of 2025, the economy grew 1.1 percent. "Growth in the second quarter was driven by stable domestic demand," the ministry said in a statement. "The recovery in growth rates, which was already recor…
Despite Western sanctions and Ukrainian drone actions, Russia managed to conclude the spring with economic growth. Thanks to a booming defense sector and households consuming heavily. 'But there is little reason to assume that the recovery in the second quarter heralds a lasting turnaround.'
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