Russia's Economic Crossroads: An Ideal Storm Looms

As the fourth year of the Ukraine war looms, Russia faces economic challenges. Inflation, high interest rates, economic slowdown, budget deficits, and rouble volatility threaten stability. Key policymakers clash on solutions, as pressures mount for President Putin to negotiate with the US for resolving the conflict.

The Russian economy's resilience amidst the Ukraine war and Western sanctions is now challenged as the conflict nears its fourth year. Major policy disagreements arise among key economic leaders on addressing the spiraling issues.

Economists warn of an 'ideal storm' by 2025, with Dmitry Polevoy from Astra asset managers suggesting growth disappointments that year. This economic strain strengthens President Putin's push for peace talks with the U.S., as highlighted by Trump's critiques.

Inflation, high interest rates, economic slowdown, budget deficit, and rouble volatility are top challenges. Spiraling military spending fuels inflation, impacting real incomes. Central bank rate hikes aim to curb it, but high costs stifle investment, risking corporate failures, especially in vulnerable sectors like real estate.

(With inputs from agencies.)