Fitch Ratings, one of the leading global rating agencies, published another dismal outlook for Russia’s economy. Experts say tumbling oil prices and Western sanctions would force a 4% economic contraction this year. "Growth may not return until 2017," the agency warned. A steep rise in credit rates and a slump in the ruble’s value badly affected purchasing power. To make things worse, low oil prices curtailed fiscal revenues as oil is a major source of government income. These negatives severely limited the authorities' room for maneuver and made the government impose austerity measures. Fitch made their latest forecast factoring in Brent crude at $35 a barrel on average during the whole 2016 and $45 for 2017.
Other Western think tanks also foresee bleak future for Russia’s economy. The International Monetary Fund expects Russia’s GDP to decline 1%. Moody’s experts are more pessimistic in their expectations, projecting a 2.5% plunge in 2016. Only Russia’s ministry of economic development assures Russian nationals that the best is yet to come. Russia’s GDP is likely to fall at least 0.8% on condition that crude trades at $40 a barrel on average. In contrast to lackluster Western forecasts, Russia’s Minister of economic development Aleksey Ulyukaev stated there is a good chance that the economy would reverse to moderate recovery.
