OREANDA-NEWS. May 13, 2010. Economic growth may accelerate this quarter as an expansion in manufacturing gathers steam, Renaissance Capital said.

Gross domestic product may gain an annual 8.7 percent in the second quarter and 7.1 percent in the third quarter after a 7 percent advance in the first three months, the investment bank said in an e-mailed forecast.

Inventory replenishment and record-low interest rates are helping the economic recovery gain momentum after a 7.9 percent contraction last year, the most since at least 1991. AvtoVAZ, the nation’s biggest carmaker, is among companies ramping up output to meet rising demand. GDP may grow 1 percent on a seasonally adjusted basis this quarter, compared with a previous forecast of 0.4 percent, according to RenCap.

“The Russian economy has a fighting chance at a real recovery,” Alexei Moisseyev, RenCap’s chief economist, wrote in the report. “Manufacturing has been the weakest link in the recovery” and thus “any sign, even a tentative one, that manufacturing is gaining ground is very welcome and deserves attention.”

Industrial output jumped an annual 5.7 percent in March after a 1.9 percent gain in February and a gauge of manufacturing compiled by VTB Capital showed that the industry expanded at a faster pace in April.

The Economic Development Ministry said April 29 that it could raise its official forecast for growth this year to 4 percent from 3.1 percent. GDP shrank 7.9 percent in 2010.

The Central Bank cut its main interest rates for the 13th time in a year on the same day to spur credit flows, help manufacturers and drive household confidence.

Consumer spending is prompting companies to add workers on mounting confidence that demand and profits will keep improving. The jobless rate held steady at 8.6 percent and retail sales rose for a third month in March, advancing an annual 2.9 percent.