Last week brought convincing statistical evidence that the economy is back on a path to recovery. Industrial production has proven a hugely positive surprise – output grew an impressive 7.6% yoy in February, with sound growth coming across the board. Retail trade was down just 1.5% yoy in February (a major recovery vs. the 12.9% yoy decline in December) – adding fuel to the case that private consumption is gradually on the rise. Cargo transportation turnover – a proxy for economic activity – is up 2.5% yoy in 2M15. We feel confident concluding that the economy will post positive growth in 1Q16 in yoy terms after more than two years of declines. Still, the pace of recovery is likely to remain muted without more decisive and comprehensive reforms. At this point we retain our view that full-year growth will be positive but limited at 1.5% yoy.

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