Global economic activity continued to soften in June 2019, with global trade and manufacturing showing signs of marked weakness amid rising economic policy uncertainty. Oil prices fell sharply in June, with the price of Brent crude oil falling by $7 per barrel (bbl) to $63/bbl and WTI falling by $6/bbl to $55/bbl. However, oil prices rose substantially towards the end of June and into July, with the recovery in prices largely due to rising geopolitical tensions in the Middle East. Prices were also supported by an announcement of OPEC and its partners that production cuts would be extended by nine months to March 2020. In June, the global environment was conducive to major emerging market currencies, including the ruble, which strengthened with respect to the US dollar. Lower exports, attributed to lower prices for major commodities exported by Russia, along with softer global economic growth, weighed down on Russia’s current account surplus in the second quarter of 2019: Economic growth was sluggish in May, with output in five basic sectors1 tumbling to -0.3 percent, y/y, from +2.9 percent, y/y, in April. After peaking in March, the 12-month consumer price inflation continued to decrease in June, totaling 4.7 percent. Labor market dynamics were strong in May. On the back of stronger non-oil revenues, the federal budget surplus improved to 2.7 percent of GDP (cash basis) in the first five months of 2019, up from 1.4 percent of GDP in the same period last year. In May, lending to both retail and corporate segments continued to grow. Key credit risk and performance indicators remained largely stable.