Russian President Vladimir Putin has urged officials to ensure balanced economic growth as the country’s economy continues to cool down amid fears of recession. In a speech at the Saint Petersburg International Economic Forum, Putin dismissed claims that the ongoing war in Ukraine is devastating the Russian economy, citing continued growth, low debt, and economic diversification.
Putin highlighted that 43% of Russia’s GDP is now unrelated to the energy or defense sectors, underscoring efforts to diversify the economy. However, business leaders voiced concern about the economy’s health, with experts warning of the risks of stagnation and even recession.
The central bank has raised its key interest rate to its highest level since the early 2000s to combat inflation, which remains high at 9.59% annually, more than double the central bank’s 4% target. Some specialists and experts point to the risks of stagnation and even recession, with Economy Minister Maxim Reshetnikov warning that Russia is teetering on the edge of a recession.
Deputy Prime Minister Alexander Novak has called for faster rate cuts to boost economic growth, while German Gref, CEO of Sberbank, said demand for credit is weak and urged more aggressive rate cuts. The economy minister and business leaders have expressed concern about the looming credit crisis and rising bankruptcies, with steelmaker Severstal warning of a looming crisis.
The central bank’s monetary policy decisions will determine whether Russia avoids a downturn, according to Economy Minister Reshetnikov. Putin has emphasized that balanced growth is key, defined as moderate inflation, low unemployment, and sustained economic momentum.
Source: https://www.reuters.com/markets/europe/russia-must-not-let-economy-slip-into-recession-says-putin-2025-06-20