Russian businesses expect economic slowdown amid high interest rates
Investing.com -- A majority of Russian businesses anticipate an economic slowdown, according to a survey by RBK media group released Monday.
The survey revealed that 57% of Russian companies expect a slowdown in the economy, while 28% predict a recovery. The remaining 15% were unable to provide an economic outlook.
RBK also reported that 90% of companies had been forced to find new partners or suppliers over the past year, and 74% indicated they did not have sufficient access to credit.
Russia’s economy, which grew by 4.1% in 2023 and 4.3% in 2024, is experiencing a sharp slowdown this year under pressure from high interest rates.
The country’s military spending, currently at its highest level since the Cold War, has fueled inflation. This prompted the central bank to raise its key interest rate to 21% in October, reaching the highest level since 2003, early in President Vladimir Putin’s rule.
The central bank has since reduced the key rate to 20% in June and further to 18% in July. Despite these cuts, senior officials have issued warnings about the economy’s future, citing the damaging impact of high credit costs.
The next rate-setting meeting of Russia’s central bank is scheduled for September 12.
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