The Russian economy demonstrates a notable capacity to adapt when interest rates stay elevated, a regime once tied mainly to accelerating inflation. In the central bank’s monthly bulletin, analysts assess how domestic activity evolves under tighter money conditions and what this means for overall growth and stability.
The report shows that momentum remains firm as the base rate sits at 16 percent and February inflation is reported at 7.44 percent. Even with high nominal rates, demand and production indicators stay resilient, signaling a shift in the economy’s structure and adaptive behavior across sectors.
Analysts credit part of this resilience to the rise in inflation expectations observed last year, which initially led agents to adjust plans and distance themselves from sensitivity to high rates. Recently, those expectations have cooled, helping to steady financial conditions and bolster near‑term confidence.
Meanwhile, banks have preserved high‑quality loan portfolios while borrower incomes have improved, supporting a stronger appetite for commercial lending. There is a clear trend toward loosening non‑price lending conditions as lenders seek to fund viable enterprises within a recovering environment.
The bulletin emphasizes that sustained positive budget momentum and the operation of various concessional loan programs play a key role in maintaining business activity at elevated rates. Government‑backed mechanisms appear to bridge the gap between high borrowing costs and ongoing investment needs.
On wage dynamics, Golikov discusses growth in real wages over a six‑year horizon. Taken together, Russia posted accelerated economic growth in 2024, with wage gains contributing to domestic demand and consumer resilience.
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