Russia: Penalties, Weak Rubli, and Bad Harvest Are Responsible for Inflation · Global Voices

The new sanctions, the weak ruble and the lowest harvest are the reasons that led to a high in December 2024 and January 2025, according to the Russian central bank. Inflation, which reached 9.5% in 2024, has emerged as the largest economic challenge for the Russian authorities, as Russia approaches the fourth year of the “special military operation” as Moscow calls the war in Ukraine. CORVERSE Prices, due to rising food and housing costs, increased by 1.14% from the beginning of the year to 27 January, with most analysts predicting that inflation would exceed the central bank’s forecast of the year as a whole ranging to 4.5%–5.0%. The report also states that maintaining high rates of economic growth is no longer possible in an environment of limited labour and production capacity, while further stimulation would push the economy into recession. “This means that there is in fact no choice between the continuation of rapid economic growth accompanied by high inflation on the one hand and economic slowdown and deflation on the other,” says the central bank report. Source: RES – ICM