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According to the analysts, a hypothetical end to the war won’t even be enough to reverse the downward spiral.
War is expensive, and when you wage a war of aggression, prompting some of the biggest economies in the world to then sanction your economy, it can really hurt.
Last year, stories about a Russian economy in crisis kept breaking, with analysts foreseeing an increasing risk of a Russian recession coming – and now it seems to be almost certain that it will happen in 2026.
The Foreign Intelligence Service of Ukraine (FIS) quotes estimates from the Center for Macroeconomic Analysis and Short-term Forecasting (CAMAC) for saying that the Russian economy will slide into a recession by July 2026 – and that it is virtually impossible to avoid.
Failed improvements of broader outlooks
At the start of 2025, economists focused mainly on the Central Bank’s restrictive stance and its record-high key interest rate.
Although policymakers have since begun to ease rates gradually, analysts say the shift has failed to improve the broader outlook.
They point instead to falling business confidence, slower economic activity, and weakening domestic demand.
Under prolonged tight monetary conditions, many Russian analysts now see contraction as unavoidable.
Indicators flash red
Measures tracking recovery momentum are also deteriorating. In October, the recession recovery indicator fell sharply from 0.345 to 0.1, well below the 0.35 level that signals stability.
Economists interpret the drop as a warning of a downturn that could last longer than a year.
Among the pressures cited are the cumulative impact of a stronger ruble, which is eroding the trade balance, and expectations of slower global growth that could further hit exports.
An end to the war will not even be enough
Analysts say even a hypothetical end to the war against Ukraine would not automatically revive growth. A reduction in military orders, falling household incomes, and weaker industrial output could instead intensify economic stress.
Looking ahead to 2026, experts expect mounting fiscal pressures to push the government toward prioritizing select sectors, reinforcing structural imbalances and limiting any recovery. The prevailing assessment is that Russia’s economic slowdown is systemic, with few remaining tools capable of reversing it.
Sources: Center for Macroeconomic Analysis and Short-Term Forecasting, Foreign Intelligence Service of Ukraine
