Russian economy growth slows to 1 percent in third quarter

MOSCOW

Russia's growth rate slowed to one percent in the third quarter, preliminary official data showed, as the war in Ukraine held back the economy.

The 1 growth in the three months to the end of September compared to the same period last year, as calculated by the official statistics agency Rosstat, beat the 0.6 forecast made by the economy ministry last month.

But that was less than the 1.3 percent expansion the Russian economy managed in the second quarter.

The Russian economy had contracted 0.2 percent in the first quarter, its first quarterly contraction in three years.

The Kremlin has spent heavily to wage war in neighboring Ukraine.

At first this boosted Russia's economic growth.

But it also set off inflation, caused a lack of labor in non-military sectors and led to a slump in private investment, which has hobbled growth.

Western sanctions and Russian measures against foreign firms also held back private investment and economic activity.

The surge in oil prices following the U.S.-Iran war provided Russia financial respite by bringing in additional revenue for its petroleum exports, but Ukrainian attacks on energy infrastructure forced the Kremlin to restrict exports to ensure sufficient domestic supplies.