Russia’s economy once again defies the doomsayers

In the two years following Vladimir Putin’s invasion of Ukraine, Russia’s economy has repeatedly defied the doomsayers. A financial collapse, widely predicted in the spring of 2022, never came to pass. The economy fell into recession, but it was less severe than expected and passed quickly. Inflation was the most recent scare. Last year prices accelerated rapidly; economists believed they could spiral out of control. Even Mr Putin was worried. In February he urged officials to give “special consideration” to rising prices.

Once again, however, the Russian economy seems to be proving the pessimists wrong. Data released on March 13th showed that prices rose by 0.7% month-on-month in February, down from 1.1% at the end of last year. The annual rate of inflation is stabilising at around 7.5% (see chart). Forecasters expect it to fall to just 4% before long; household expectations of future inflation have flattened. Russia’s presidential election was due to begin on March 15th, after we went to press. The result is a foregone conclusion. If it was competitive, these figures would do Mr Putin no harm.