Russian economy on the abyss: ruin decline and record interest threaten!

Russian economy on the abyss: ruin decline and record interest threaten!

The Russian economy is on the abyss, and the ruble decline is the main cause of this crisis. Western sanctions have put the ruble under great pressure, so that experts warn that Russia has got into a dangerous downward spiral. As a result of the sunken ruble course, consumers and companies have to raise far more money for imports, which drives inflation up. Inflation in Russia is currently about nine percent, with the key interest rate of the central bank being raised to alarming 21 percent again. According to az-online.de A fear of bankruptcies, since the high interest rates make loans and investments brake.

Record control and impending interest rate increases

The central bank may be forced to increase the key interest rate to up to 23 percent before the month. The deputy chairman of Sberbank, Kirill Tsarev, expressed that prices are increasing the need for this measure. This aggressive monetary policy is particularly urgent, since inflation is further fueled by the falling ruble, which makes life considerably more expensive for Russian consumers. With regard to these challenges, the central bank warned of “more drastic changes” in monetary policy, which indicates further tightening of the economic conditions, as chiemgau24.de reported.

In fact, the decay of the ruble and the enormous challenges with which the Russian economy is confronted could lead to a historical economic decline. Companies are fighting for survival, while increasing the key interest rate in an already tense market brings additional loads for consumers. This leads to a precarious situation that could have a lasting impact on the Russian economy.