The Russian economy could be described as a house of cards: Standing, but just built on shakie premises that could rapidly bring it crashing down. The Russian Central Bank, aware of how bad the economic situation has become, is taking dramatic steps to try to get Moscow's ecomony back-on-track - but will they succeed?
Dr. Volodymyr Lugovskyy explains to Kyiv Post's Jason Smart that Russia is in a very challenging situation given the rapid and rising inflation, which was instigated due to unchecked Kremlin spending, following the full-scale invasion of Ukriane. Coupled with the blows being landed due to Western sanctions, Russia is now facing a quagmire: Let up on government spending, triggering cuts in social spending that could hurt Putin's popularity, or should the Kremlin keep printing rubles, seeking to "bail out" their damaged economy, but thereby creating wider inflation?
JOIN US ON TELEGRAM
Follow our coverage of the war on the @Kyivpost_official.
Lugovskyy, who was born in Ukraine, received his PhD from Purdue University and is an Associate Professor of Economics at Indiana University, where he is now the Chair of the Economics Department. Lugovskyy’s primary research interests include international trade, experimental economics, and financial economics. He has numerous publications in leading journals, such as the American Economic Review, European Economic Review, Journal of Financial Economics, and Journal of International Economics.
Dr Lugovskyy's detailed discussion with Jason Jay Smart shines light on what we should expect to see next in Russia.
