Putin Counters Economic Destabilization Concerns Amid War

Russian President Vladimir Putin rejected claims that the war in Ukraine is harming Russia's economy, highlighting growth and lower debt as proof of resilience. While inflation eases, economic policy debates continue. Business leaders express worries over credit demand and potential recession as interest rates remain contentious.

At the Saint Petersburg Economic Forum, Russian President Vladimir Putin dismissed assertions that the ongoing war in Ukraine is damaging Russia's economy, citing indicators such as sustained growth and low national debt as evidence of robustness. However, business leaders expressed apprehension about the economy's overall health.

Despite high annual inflation of 9.59%, the rate has shown signs of easing since April. The Bank of Russia's interest rate adjustments and concerns about economic cooling after years of war-induced growth were major talking points during the forum.

Economy Minister Maxim Reshetnikov cautioned that Russia risked nearing a recession, while Central Bank Governor Elvira Nabiullina faced criticism over monetary policy. Calls for lower interest rates accompanied warnings from business figures about weak credit demand and potential bankruptcies in key sectors like steel.

(With inputs from agencies.)