Russian President Vladimir Putin on Tuesday cautioned his economic team against overcooling the national economy through overly tight monetary policies ahead of the central bank's impending rate decision.
Speaking to a congress of a prominent Russian business lobby during a so-called “silence week” – when the central bank refrains from public comment on its upcoming decision – Putin warned that excessive cooling could stifle economic activity, likening such a scenario to freezing the economy in a "cryotherapy chamber."
All 29 economists polled by Reuters expect the central bank to keep its key interest rate on hold at 21%, the highest level in over 20 years, in an effort to rein in inflation. However, several experts and advisors have noted that aside from the defense sector, much of the Russian economy is already stagnating, with critics arguing that the central bank's stringent policies are choking off investment.
"It is clear that this (cooling) is inevitable. Both the government and the central bank have generally talked about it. Overall, there seems to be an agreement," Putin said, acknowledging the challenges of maintaining economic stability under current measures. He further stressed, "It's essential that everything proceeds as planned in practice, avoiding excessive cooling like in a cryotherapy chamber," drawing an analogy to a wellness treatment where individuals are exposed to extreme cold, sometimes as low as -140 degrees Celsius.
The central bank's recent decisions have sparked debate among economists and business leaders alike. Last December, it surprised analysts by unexpectedly keeping rates unchanged after Putin had called for a “balanced” approach just one day prior to the board meeting. Rates were held steady again in February, reinforcing the administration’s cautious stance.
Looking ahead, the central bank forecasts that Russia's economic growth will slow to between 0.5% and 1.5% in 2025 as a result of its restrictive monetary policy, while the government is projecting growth of around 2.5%. Critics argue that the tight policy is stifling investment without effectively lowering inflation. "Today, investment programs have practically come to a standstill," said Sergei Chemezov, head of the defense and industrial conglomerate Rostech and a longtime friend of Putin.
As the central bank prepares to announce its decision on Friday, the balancing act between curbing inflation and avoiding further economic stagnation remains a key challenge for Russian policymakers.
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The U.S. government on Tuesday released documents related to a legal battle over Prince Harry’s 2020 visa application but redacted large portions, citing privacy protections and a lack of evidence that he received special treatment.
Ukrainian President Volodymyr Zelenskyy said on Tuesday that Ukraine would support a U.S. proposal to halt attacks on Russian energy infrastructure but warned that Moscow was using the negotiations to delay and weaken Kyiv.
Israeli Prime Minister Benjamin Netanyahu declared on Friday that Israel has resumed combat operations in Gaza “with full force,” following the collapse of a temporary ceasefire. Speaking in Tel Aviv, he warned that the latest wave of airstrikes was “just the beginning” of renewed military action.
U.S. President Donald Trump took to Truth Social on Tuesday to comment on his phone conversation with Russian President Vladimir Putin, calling it a “very good and productive one” and claiming progress toward ending the war in Ukraine.
Speaking at a meeting of AIPAC’s board of directors, Israeli Foreign Minister Gideon Sa’ar stated that the decision to resume strikes in Gaza was made several days ago and that the military operation will persist beyond today.
The U.S. government on Tuesday released documents related to a legal battle over Prince Harry’s 2020 visa application but redacted large portions, citing privacy protections and a lack of evidence that he received special treatment.
Ukrainian President Volodymyr Zelenskyy said on Tuesday that Ukraine would support a U.S. proposal to halt attacks on Russian energy infrastructure but warned that Moscow was using the negotiations to delay and weaken Kyiv.
Israeli Prime Minister Benjamin Netanyahu declared on Friday that Israel has resumed combat operations in Gaza “with full force,” following the collapse of a temporary ceasefire. Speaking in Tel Aviv, he warned that the latest wave of airstrikes was “just the beginning” of renewed military action.
U.S. President Donald Trump took to Truth Social on Tuesday to comment on his phone conversation with Russian President Vladimir Putin, calling it a “very good and productive one” and claiming progress toward ending the war in Ukraine.
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