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World Bank Forecasts 2-Year Recession in Russia Over Oil Prices, Sanctions

© Wikipedia / Shiny Things The World Bank Group headquarters bldg. in Washington, D.C.
The World Bank Group headquarters bldg. in Washington, D.C. - Sputnik International
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Low oil prices and anti-Russian sanctions will extend recession in the country longer than expected into 2016, an updated World Bank report published on Wednesday said.

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MOSCOW (Sputnik) — Despite a 0.1 percent growth in Gross Domestic Product (GDP) estimated by the United Nations financial organization in January, the revised forecast pegs a 0.3-percent drop in Russia's GDP.

According to the report, the World Bank's negative two-year economic outlook in Russia is based on the assumption that oil prices will stay at an average of $53 a barrel.

The bank also heightened its forecast for the rate of GDP decrease this year, predicting it to be 3.8 percent. The January prediction was 2.9 percent.

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As many as 14 percent of Russians will be considered to be impoverished, living on less than $5 dollars a day in 2015, the report said. This value will increase to 14.1 percent in the following year.

Russia is currently experiencing an economic downturn. The slowdown is primarily the effect of the global drop in oil prices and Western economic sanctions.

According to the Russia's Central Bank, this trend is likely to continue well into the first quarter of 2016.

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