IMF Forecasts Russian Economy to Shrink by 3 Percent in 2015

In an update to the International Monetary Fund's October 2014 World Economic Outlook, published on Monday, the Russian economy is reported to contract by three percent in 2015, according to its latest report on global economic trends.

MOSCOW, January 20 (Sputnik) — The International Monetary Fund (IMF) is expecting the Russian economy to contract by three percent in 2015, according to its latest report on global economic trends.

In an update to its October 2014 World Economic Outlook, published on Monday, the IMF also lowered its forecast of Russia's GDP in 2016 from 1.5-percent growth to decline of one percent.

"The projection reflects the economic impact of sharply lower oil prices and increased geopolitical tensions, both through direct and confidence effects," the report said.

The Russian economy is currently experiencing a slowdown amid low oil prices, as the country is heavily dependent on energy exports. Western sanctions against Moscow are also named among the reasons of the economic slump.

In mid-December 2014, the Russian Central Bank estimated Russia's budget deficit for 2015 at 1.3 percent of the country's GDP, as opposed to a 0.6-percent deficit envisaged by a draft federal budget for 2015-2017.