Russia brakes the economic growth to control inflation, and the recession is “far”, Putin says: “It is a deliberate action”
President of Russia, Vladimir Putin, at the Novo-Ogyovo residence, in the Moscow region, on September 18, 2025. Photo: Mikhail Sinitsyn / Zuma Press / Profimedia
President Vladimir Putin said on Thursday that Russia is deliberately slowing economic growth to suppress inflation and that the second world exporter of oil is far from a recession, Reuters reports.
“It is a deliberate action. It is a slowdown in growth in exchange for reducing inflation and maintaining macroeconomic stability,” Putin said during a meeting with high -ranking parliamentarians, which was televised.
A graph published in the report of the Russian Central Bank in early September showed two consecutive quarters of lowering the gross domestic product (GDP), in quarterly terms, which is in accordance with the common definition of a technical recession.
Putin has minimized concerns about economic decline, stating that the Russian economy is far from entering the recession.
“I think the recession is still far away, and the labor market reflects this,” Putin said, thus resuming the position of the governor of the central bank of Russia, Elvira Nabiullina.
The United States, Europe and their allies have imposed over 25,000 different sanctions on Russia following the war triggered in 2022 in Ukraine and Crimea annexation, in 2014, in an attempt to sink Russia and undermine the support for Putin.
Russia's war economy increased by 4.1% in 2023 and 4.3% in 2024, much faster than G7 countries, but slows down below the weight of the high interest rates.
The Kremlin has no other solution to keep the budget deficit under control than to increase the VAT, despite the promises of President Vladimir Putin that there will be no more taxes, four Reuters sources said, confirming the information – also on sources – of the Russian independent public.
The enormous Russia's military spending for the Ukraine war has created a major budget problem, The Bell noted. A final decision has not yet been made, but at this time there is no other solution to “close” the budget, even if it is cut from the military expenses, the sources of the publication that was declared “foreign agent” by Moscow said.
Russia has to make the next few days a crucial decision on the economy / has only one solution, otherwise “it would be as if you cut a pig”
The decision must be made quickly, as the draft budget is to be presented to the Parliament on September 29. Its key components are previously agreed with Putin and is unlikely to be significantly modified during the official parliamentary debate.
An important signal was given the previous days by former president Dmitri Medvedev who qualified the budget project for 2026, currently in preparation, as a “war” budget and stated that social expenses, including the support given to the veterans of the conflict, should not be sacrificed to balance finances.
