Latest trade figures point to a still solid export outlook and strong growth in domestic demand. USD-denominated exports rose by +7.9% y/y in January (after +7.5% in the previous month). Import growth surged to +26.4% y/y (after +18.1% y/y) driven by a strong rise in non-oil and gas purchases (+28.1% y/y). Car sales figures were also buoyant with growth of +11.1% y/y in January (from -2% y/y the previous month). The key policy interest rate was kept unchanged at 4.25% at the last monetary policy meeting. Policymakers are comforted by improving GDP growth prospects and a limited rise in inflation, yet elevated financial risks (for example currency and financial market volatility) call for caution. Going forward, we expect economic growth to improve gradually to +5.3% in 2018 (after +5.1% in 2017). Investment is set to pick up progressively thanks to higher infrastructure spending and easier regulation for foreign investors.
