Rising prices overshadow conflict: Inflation grips Russia
According to a survey by the Levada Center organisation, inflation is the main concern for Russians, surpassing the armed conflict. A significant 63% of respondents identified rising prices as the biggest issue, while war and sanctions took second place with 35%, reports the Moscow Times.
The publication notes that surveys conducted by the Levada Center, a non-governmental organisation designated as a foreign agent by the Kremlin, reveal that 63% of families allocate at least half of their income to food. Other studies suggest that 6-9% of Russians lack sufficient resources even for basic food necessities.
According to Rosstat data, prices increased by 31.7% between 2022 and 2024, with inflation in 2024 alone standing at 9.5%. Food products, in particular, have seen rapid price hikes, significantly stressing household budgets.
Russians are also experiencing other economic challenges. Housing issues rank third among concerns, noted by 30% of respondents. Worries about an economic crisis have risen from 9% in March 2024 to 16% currently.
Authorities admit: There is a problem
The Moscow Times also reported that Russian President Vladimir Putin, in a public discussion with Prime Minister Mikhail Mishustin, acknowledged that inflation remains a serious "challenge" for his country's economy. "We must do everything necessary to ensure sustainable growth," stated Putin.
Mikhail Mishustin added that Russia's economy grew by 4.1% in 2024, the same growth rate as in 2023. The Prime Minister concurred with Putin, noting that "it is absolutely clear that the main challenge is inflation."
The Central Bank of Russia announced earlier this week that it sees "no signs of a sustained slowdown in price growth," despite maintaining a record high interest rate of 21%.
The regulator cited Western sanctions, ruble depreciation, and poor harvests as the main factors driving inflation. Additionally, it noted that defence spending fuels demand, which continues to outstrip the economy's ability to supply goods and services.
The Central Bank of Russia forecasts that inflation will drop to between 5.2% and 8.6% by the end of 2025. The central bank plans to hold another interest rate meeting on 14 February.
