Russian business confidence hits lowest point since 2022

Russia’s Business Climate Indicator (BCI), calculated by the Russian Central Bank based on a June survey of 13,500 companies, has fallen from 4.8 points in May to 2.9 in June – its lowest level since December 2022, when it dropped to 2.4.

Source: The Moscow Times, an independent Amsterdam-based news outlet

Details: The BCI reflects business activity: a value above zero indicates growth, below zero indicates contraction. 

Although the indicator is still positive, The Moscow Times notes that growth has slowed significantly.

The decline is near-universal, with a deterioration in both current performance (production and demand) and business expectations across most sectors.

Assessments of current business conditions have remained negative since the beginning of the year, and the downturn intensified in June, particularly in the manufacturing sector. Nearly every industry, with the exception of oil and gas, mining and agriculture, has reported worsened conditions.

Manufacturing, in particular, has seen a sharp downturn. 

Civilian industries have shifted from stagnation to recession, according to the Centre for Macroeconomic Analysis and Short-Term Forecasting (CMASF), a think tank close to the Russian authorities.

Background: Russian Economy Minister Maxim Reshetnikov has admitted that "based on business sentiment", the country is already on the brink of recession.

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