Former minister predicts risk of stagflation for Russia’s economy

Former Russian Economic Development Minister Alexey Ulyukayev has stated that Russia’s economy is not facing a sharp collapse, but warned that the country is more likely to experience prolonged stagflation.

He said the economic situation could potentially shift toward stagflation—a scenario characterised by slowing growth alongside rising unemployment and inflation, Caliber.Az reports, citing Russian media.

Ulyukayev said the Russian economy has a high degree of inertia and, in his view, a “dramatic” downturn or full-scale crisis is unlikely.

He was commenting on statements by the deputy chief of staff of the Presidential Executive Office, Maxim Oreshkin, who previously said that Russia was on a path of sustainable economic growth and that the current slowdown was planned.

Ulyukayev agreed that the slowdown reflects efforts to curb excess demand and labor market pressures, but added that it is also linked to a range of non-economic factors.

Russian President Vladimir Putin said earlier that GDP declined by 1.8% in January–February, with manufacturing, industry, and construction all in negative territory.

He attributed part of the downturn to seasonal factors, adding that authorities should focus on measures to stimulate economic growth.

By Bakhtiyar Abbasov