The Russian economy experienced minimal growth in the third quarter, with increased military spending playing a key role. This spending, however, has led to inflation, which is now hindering growth. The central bank has raised interest rates to combat inflation, but this has not been enough to offset the negative impacts of war spending.
Analysts warn that the prolonged military conflict is straining the economy, as resources are being diverted away from civilian sectors. This has led to a decline in consumer spending and a slowdown in industrial production. The government’s reliance on war-related spending is creating a cycle of inflation and economic stagnation.
The International Monetary Fund (IMF) has expressed concern about the economic outlook for Russia, citing the long-term risks of sustained military expenditure. The country’s economic growth is expected to remain low, with challenges in maintaining stable inflation rates and achieving sustainable development.