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‘Too early’ for optimism on Russia growth: Analyst

Russia's economy contracted 4 percent in the year to November, highlighting continued trouble for the country despite claims that its economic crisis has peaked.

The number is worse than the October gross domestic product (GDP) figure, which showed a 3.7 percent decline from a year earlier.

It comes just weeks after Russian President Vladimir Putin told reporters that the economy had generally overcome "the peak of the crisis" and was starting to stabilize.

Shoppers browse luxury stores in the GUM department store in Moscow, Russia, on Sunday, Dec. 20, 2015.
Andrey Rudakov | Bloomberg | Getty Images

Chris Weafer, a senior partner at Macro-Advisory, told CNBC that November GDP was worse than expected, with many economists predicting a smaller contraction of 3.6 percent.

He said weak consumer trends — dragged down by a near 10 percent drop in real wages and high debt repayment costs — were to blame. Retail sales were down 13 percent from a year earlier last month, compared to a 8 percent decline in the first half of 2015.

"The November data shows that it is far too early to be optimistic that the worst is over for the economy; it certainly is not for the beleaguered consumer," he told CNBC via email.

Weafer predicts the economy is likely to stay in recession until at least the middle of 2016, but said that growth after that point would depend in part on whether consumer and business confidence trends can be reversed, whether oil prices can recover, and whether Western sanctions on the country's financial sector are eased.

Economic sanctions linked to Russia's involvement in Ukraine have compounded the pains of plummeting crude prices, both of which have put pressure on the ruble and sent inflation soaring to 15 percent — contrary to the deflationary effects low oil prices have had on most importers of the commodity.

While the International Monetary Fund (IMF) predicts the Russian economy will contract 3.8 percent this year, Weafer says that the November GDP figure suggests the full-year decline for 2015 could be closer to 4 percent.

"At minimum, in terms of the economy, it looks like this winter will be every bit as tough as last year's," he said.

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