Consumer demand 'fuels faster Russian economic growth'

Russian President Dmitry Medvedev Russian President Dmitry Medvedev wants to modernise the oil-dependent economy

Russia's economic growth accelerated in the three months to June, mainly due to rising consumer demand, according to its deputy economy minister.

Gross domestic product (GDP) grew by 5.4% compared with the same period a year ago, Andrei Klepach said.

The government has forecast the economy to expand by 4% this year.

But Mr Klepach said the fresh data meant Russia would "be reconsidering the [2010] forecast for both industrial output and GDP upwards".

"Economic growth continues, but it has not yet become investment oriented," he added.

"The factors of growth remain fairly fragile with the exception of consumer demand."

Russia was one of the countries hit hard by the global crisis, and its economy fell by 7.9% in 2009.

First quarter growth in 2010 was 2.9% year-on-year.

In the second quarter the economy grew by 1.1% from the January-March period, Mr Klepach said.

Russia's statistical agency, Rosstat, will issue the official growth data in August.

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