Camilla Jessen
After a turbulent first half of 2025, Russia’s economy is now projected to flatline.
The Central Bank of Russia has issued a new economic forecast, warning that the country’s economy may see no growth at all by the end of 2025.
This comes from a new report published on August 6, as reported by The Moscow Times.
In the report, the Bank said it had lowered its expectations for this year. “We now estimate that GDP growth may be close to zero by year-end,” it said.
Industries Are Slowing Down
The Bank says construction, trade, and manufacturing are all seeing less activity. Domestic demand is falling, and exports are shrinking. What started as a slowdown is now turning into a full stop.
“The economic momentum observed in the first half of 2025 has nearly stalled,” the report says.
Sanctions Are Hurting
Western sanctions, put in place after Russia’s invasion of Ukraine, are starting to have a stronger effect. The country is struggling with less access to foreign technology, fewer international deals, and declining oil and gas income.
According to The Moscow Times, oil and gas revenues dropped 30% in July compared to the same time last year. That’s a huge hit to the budget.
Prices Are Going Up Again
At the same time, inflation is picking up. Prices are rising faster than the Central Bank had expected, putting pressure on everyday Russians.
Food, goods, and services are getting more expensive, while wages and jobs are not growing at the same pace.
International Outlook Is Also Gloomy
The International Monetary Fund (IMF) recently predicted that Russia’s economy would grow by only 0.9% in 2025 and 1.0% in 2026.
That’s far below the 4.1% growth Russia saw in 2024. Economists say this drop is caused by long-term sanctions, weaker exports, and falling productivity.
Big Promises, Poor Results
The Russian government has promised to boost its economy and avoid a recession, but results are not looking good. Many of the issues are long-term and will not be fixed quickly.
Without changes, experts say Russia could face even more economic problems in 2026.
