Russia’s economic growth probably accelerated in the third quarter for the first time since last year as companies stepped up investment and bank lending buoyed consumer spending.
Gross domestic product expanded 5 percent from a year earlier, matching the fastest pace since the second quarter of 2010, after increasing 3.4 percent in the previous three months, according to the median estimate of 14 economists surveyed by Bloomberg. The Economy Ministry estimated growth at 5.1 percent. The Federal Statistics Service will release GDP figures today or tomorrow.
The world’s largest energy exporter is counting on domestic consumption to balance shrinking demand abroad as Europe fights to staunch a debt crisis. Prime Minister Vladimir Putin, who will run for president next year, is seeking annual growth of between 6 percent and 7 percent and turn the economy into one of the world’s five largest.
Mario Monti to Lead New Italy Government
Former European Union Competition Commissioner Mario Monti will head a new government as Italy reaches outside the political arena for a leader to restore confidence in its ability to cut the euro region’s second- biggest debt.
President Giorgio Napolitano offered Monti, 68, the post last night in Rome, less than 24 hours after Prime Minister Silvio Berlusconi resigned. Berlusconi’s government unraveled after defections ended his parliamentary majority and the country’s 10-year bond yield surged over the 7 percent threshold that prompted Greece, Ireland and Portugal to seek EU bailouts.
“In a particularly difficult moment for Italy, in a very turbulent European and international landscape, the country must prevail in the challenge of redemption,” Monti said last night after meeting Napolitano in Rome. “Italy must once again be an element of strength, not of weakness, in the European Union, which we helped found and in which we must be protagonists.”
Europe’s inability to contain a regional debt crisis that started in Greece more than two years ago led to a surge in Italian bond yields as investors bet on which nation may need aid next. Monti, an economist and adviser to Goldman Sachs Group Inc., will try to reassure investors that Italy can cut a 1.9 trillion-euro ($2.6 trillion) debt load and spur economic growth that has lagged behind the euro-region average for more than a decade.
China Shock of 5% Growth Seen Deferred by Migrant Factories
Guangzhou Constant Shoes Co. is set to abandon Guangdong, the southeastern province at the center of China’s exporting boom since the 1980s, by shifting most of its production 500 kilometers (311 miles) inland.
Rising labor costs and a shrinking supply of workers in coastal areas are threatening to sap China’s strength in exports, which account for more than a fifth of gross domestic product. To cope, the maker of women’s and men’s fashion footwear chose to tap a pool of cheaper labor in Yongzhou, Hunan province.
Supplier Shortage Other impediments include fewer suppliers, the reluctance of young inland workers to take factory jobs and a lack of business savvy among some local governments, according to manufacturers interviewed by Bloomberg News this month in Guangzhou at the Canton Fair, China’s biggest trade show.
Slowing Growth China’s economy expanded 9.1 percent in the third quarter from a year earlier, the least since 2009, after five interest- rate increases starting in October 2010 cooled property-price gains.
Suppliers of goods used to build or decorate homes will benefit as new inland factories help create the need for more low-cost housing, said Andy Mantel, managing director of Pacific Sun Advisors’ Mantou Fund in Hong Kong.
“I look for good companies that are making products that will benefit from the roll-out of social housing,” Mantel said. His fund has held China Liansu Group Holdings Ltd. (2128), a Foshan- based maker of plastic pipes, since last year.
