‼ Industry in September: record growth since the beginning of the year We already wrote about the economic recovery in September. Yesterday's data from Rostat on industry confirms this: PPI: 1.1% mm yy / 1.8% yy; 9M26: 0.2% yy Petroleum products production: -4.3% mm / -17.3% yy, 9M26: -11.0% yy. Problems at the refineries intensified the decline in production: -1.5% m/m / -4.1% yy; 9M26: -1.3% yy Where does the growth come from then? Due to processing: 3.4% mm sa / 5.6% y; 9M26: 1.0% The main driver is again the military-industrial complex. But there has been a sharp recovery in several civilian industries: Metal: 10.0% yy, 9M26: -3.4% yy and Automotive: 27.7% yy, 9M26: 7.5% yy excluding petroleum products, IPP growth: 3.4% yyy, 9M26: 1.2% yy Manufacturing growth excluding petroleum products: 8.7% yy, 9M26: 2.9% yy If the increase in API was related to capacity restoration, it would be disinflationary. But judging by oil products, there is no restoration potential. The boom is linked to an increase in demand, incl. for military-industrial complex products. And it is pro-inflationary. The economy is again heading towards overheating, and this may require raising the MMI coefficient to the max.

‼ Industry in September: record growth since the beginning of the year We already wrote about the economic recovery in September. Yesterday's data from Rostat on industry confirms this: PPI: 1.1% mm yy / 1.8% yy; 9M26: 0.2% yy Petroleum products production: -4.3% mm / -17.3% yy, 9M26: -11.0% yy. Problems at the refineries intensified the decline in production: -1.5% m/m / -4.1% yy; 9M26: -1.3% yy Where does the growth come from then? Due to processing: 3.4% mm sa / 5.6% y; 9M26: 1.0% The main driver is again the military-industrial complex. But there has been a sharp recovery in several civilian industries: Metal: 10.0% yy, 9M26: -3.4% yy and Automotive: 27.7% yy, 9M26: 7.5% yy excluding petroleum products, IPP growth: 3.4% yyy, 9M26: 1.2% yy Manufacturing growth excluding petroleum products: 8.7% yy, 9M26: 2.9% yy If the increase in API was related to capacity restoration, it would be disinflationary. But judging by oil products, there is no restoration potential. The boom is linked to an increase in demand, incl. for military-industrial complex products. And it is pro-inflationary. The economy is again heading towards overheating, and this may require raising the MMI coefficient to the max.