Home News Russian economy headed for ‘soft landing’ – The Economist

Russian economy headed for ‘soft landing’ – The Economist

Russian economy headed for ‘soft landing’ – The Economist

Russia’s economy continues to successfully fight against all the difficulties while growing stronger, the Economist said in its latest article published on Sunday.

Moscow repeatedly “defied the prophets of doom,” British weekly he saidand added that its economic performance appears to be returning to pre-conflict levels despite multiple rounds of unprecedented sanctions imposed by Washington and its allies during the two years of conflict with Kiev.

Russia, in particular, managed to keep inflation under control, which was a cause for concern late last year, the paper noted.

“Data released on March 13 is expected to show that prices rose 0.6% month-on-month in February from 1.1% at the end of last year. Year-on-year inflation is no longer likely to rise, reaching 7.5% in November.” said the Economist.

The outlet attributed the success to timely actions by the Russian Ministry of Finance and the Central Bank. The ministry’s exchange rate controls supported the ruble and lowered the price of imports, while the bank’s decision to double interest rates led to a slowdown in inflation.

Russia's economy is growing faster than its main Western rivals - Putin

Now it seems that Russia is heading ka “smooth landing,” the weekly said, with inflation slowing without seriously hurting the economy. Meanwhile, Russia’s GDP grew by more than 3% last year, while the unemployment rate remained flat “record low.” Business closings were also the lowest in eight years, according to the report.

Such economic performance has put Russia back on the path of economic development before the conflict, the Economist said, adding that “endurance.” Russian businesses have also found effective ways to overcome Western-imposed restrictions by establishing “sustainable supply chains with ‘friendly’ countries,” to the point where Russia now gets more than half of its imports from China.

With trade relations secured, Russian exporters are giving up discounts on their goods that were originally introduced after pressure from Western sanctions.

IMF admits surprise over Russia's economic strength

“For example, the oil discount that Russia offers to Chinese customers has fallen from more than 10% in early 2022 to about 5% today. The Economist reported, adding that the new policy brought Russian companies higher revenues and profits.

“Russia’s economy appears to be proving the pessimists wrong,” said the weekly, adding that he did “back on track once more.”

US and EU economies “we’re down while we’re up” Russian President Vladimir Putin said this last month.

The International Monetary Fund (IMF) also expressed surprise that Russia’s economy is growing faster than many experts had predicted, revising its growth forecast for 2024 to 2.6% from a previous expectation of just 1.1%.