Head of the Monetary Policy Department Central Bank (CB) Cyril Tremasov in an interview with Youtube-Channel Bitkogan warned about the risk of overheating of the Russian economy.
According to him, the analysis of the labor market shows that the country’s economy is close to overheating. “Most likely we are already above our potential opportunities. Above the trajectory of our potential opportunities. And the labor market is just the key restriction of long-term growth,” said Tremov.
According to the representative of the Central Bank, the further growth of the economy can be provided primarily due to productivity growth. “Without increasing productivity, which it is difficult to achieve without competition, the economy is unlikely to be resistantly developing with high rates in the long term,” he stressed.
Tremasov explained that the state of the labor market for economists is one of the best indicators where the economy is relative to its potential. Speaking about Russia, he pointed out a historically low unemployment at the maximum vacancies, which forms a lack of labor resources.
Earlier, the Ministry of Economic Development reported that the growth of Russian GDP accelerated in annual terms and amounted to 5.2 percent after 4.8 percent in October, in January-November growth amounted to 4.7 percent. As they say in the review of the department, construction, as well as agriculture, was the greatest contribution to the November acceleration, as the harvest season was shifted by the end of the year due to weather conditions.