The customs data indicates that the trade statistics from the CBR, due today, might show a weaker than expected reading, below USD 12.0bn. July’s poor trade balance (it could be the weakest reading since November 2010) is a combination of low exports (that had not yet rebounded in July as oil prices had just started to pick up) and strong imports (including a spike in aircraft imports to USD 1.0bn, from USD 0.4bn in June).
The preliminary data for non-CIS imports in August showed a lower reading (-5.8% MoM SA) on the back of a sharp drop in volatile components (from USD 2.5bn in July to USD 1.7bn in August, mainly as result of the decline in aircraft imports) and investment goods imports (the YoY growth in equipment reversed sharply, from +10.8% YoY in July to -6.1% YoY in August). The stronger reading of cars imports (YoY growth advanced from 21.3% to 40.2%) has helped the growth in imports exvolatile components to slow from 11.2% YoY to just 5.2% YoY. Combined with the expected rebound in exports (which is to follow the strong oil price performance during July-August) lower imports would allow the trade balance to bounce in August. The drop in the import of investment goods is worrisome, and might point to a investment activity in Russian economy slowing further.