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. Last Updated: 07/27/2016

RenCap Sees Spotty Summer Recovery

Russia's economic recovery will be unstable throughout the summer, disrupted in part by economic turmoil in Europe, Renaissance Capital said in a report Thursday.

Real gross domestic product will likely grow 5.3 percent year on year in the second quarter of 2010 and by 2.8 percent in the third quarter, according to the investment bank's leading indicator, developed with the New Economic School.

That amounts to quarter-on-quarter growth of 1.4 percent and 0.7 percent in the second and third quarters, respectively.

GDP fell 7.9 percent in 2009 before rebounding 2.9 percent in the first quarter, according to the State Statistics Service. The Economic Development Ministry predicts a growth of about 4 percent in 2010.

Both companies and consumers "responded with greater confidence to an improved macroeconomic environment," said Alexei Moisseyev, Renaissance Capital's chief economist.

A more conducive macroeconomic situation however will not prevent GDP growth from cooling down in the third quarter.

The slowdown is expected on the back of economic turmoil in Europe, which has lowered commodity prices and marked a return of a more conservative behavior on the market, including in the real economy, the report said.

Urals crude, Russia's main export, has fallen more than 14 percent from its post-crisis peak in late April, pushing MICEX down 13 percent.