Russia’s economy ministry sees the domestic economy contracting 8.5% this year, deeper than prior forecasts for a 2.2% decline. Growth is seen in 2010 but at an insignificant 0.1% pace. The rouble is expected to decline gradually versus the dollar through 2012. Russia raised the oil price used for budget purposes to $54 per barrel from $41 per barrel.
Looks like emerging markets may not lead us out of recession after all, a blow to the reflation trade, especially if the Chinese “miracle ” turns out to be a mirage.
