The International Monetary Fund slashed its economic forecast for Russia’s year on year growth in 2025 from 1.8% to 1.3% of real GDP, according to its October 2024 World Economic Outlook.
The IMF’s projection for Russian economic growth in 2024 is estimated at 3.6% of real GDP, which is slightly better than the 3.2% growth the IMF forecasted in April. The data for the end of 2023 remained the same at 3.6%.
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The decrease of Russia’s economic growth also impacted the overall forecast for emerging economies.
“Growth in emerging and developing Europe is projected to remain steady at 3.2% in 2024 but to ease significantly to 2.2% in 2025,” the World Economic Outlook said.
A drop from 3.6% in 2023 to 1.3% in 2025 is due to slower private consumption and investment, as well as slower wage growth and “reduced tightness in the labor market.”
Turkey also impacted slower growth of emerging economies, as the country tightens its monetary and fiscal policy since mid-2023.
Previously, Russian media outlet the Bell reported that the Russian central bank is bracing to raise the key rate again from 19% to 20-21%. Russian corporate lending is increasing and the demand inside the country cannot keep up with the production and import volumes. Inflation expectations also increased from 12.5% to 13.4% – the highest since December 2023.
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