MOSCOW, August 29. /TASS/. Inflation in Russia will gradually decelerate over the next three years, and by the end of 2025 it may fall below 7%. At the same time, economic growth is expected to remain in the range of 1-2%, according to experts surveyed by TASS, who pointed to untimely monetary easing and labor shortages as key challenges for the economy.
"By the end of 2025, inflation will amount to 6.7%, GDP growth will reach 1.6%, and unemployment will stand at 2.4%. Over the next three years, inflation is expected to slow gradually, while economic growth will hover around 2% annually (assuming all else remains equal)," Ksenia Bondarenko, Associate Professor at the Department of World Economy, Faculty of World Economy and International Affairs at the Higher School of Economics, said. She emphasized that exports and imports will remain contingent on global market conditions, with continued risks linked to energy price volatility and secondary sanctions. The labor market remains resilient: unemployment is at a low level, indicating sustained high demand for labor amid a limited supply of workers.
Vladimir Yeremkin, Senior Researcher at the Laboratory of Structural Studies of the Institute of Applied Economic Research at the Presidential Academy, noted that Russia’s economy continues to demonstrate significant resilience, despite a gradual slowdown. In his view, GDP growth this year may remain no lower than 1.4-1.7%, with a slowdown in 2026 to 0.7-1.1%.
"Economic growth is still supported by elevated government spending, primarily in the defense-industrial sector, alongside robust investment demand and rising household incomes. In 2026, some slowdown is expected as the impact of previously implemented stimulus measures diminishes and monetary policy remains tight. The main constraints remain the shortage of labor resources, the inability to rapidly expand domestic production, and the high cost of money in the economy," Yeremkin said.
Easing labor market tensions and Central Bank’s targets
The expert identified the key challenge for the coming year and a half as the transition from growth driven by elevated government spending to growth underpinned by private investment and non-commodity exports.
"Inflationary pressure will not disappear from the agenda and will persist. High interest rates are constraining price growth, but elevated budgetary expenditures, rising business costs, and unanchored inflation expectations among both businesses and households continue to exert upward pressure," he noted, adding that in 2026 inflation may stand at 5.5-5.9%.
"The baseline forecast assumes that the Bank of Russia’s policies will begin to yield fuller effects, possibly easing labor market tensions and reducing federal budget expenditures. The 4% inflation target appears difficult to achieve in the medium term," Yeremkin said.
He also stressed that persistently high inflation in tandem with economic stagnation would place additional pressure on the Central Bank, which would strive to maintain tight monetary policy, while the government would push for rate cuts to stimulate economic growth. Accordingly, Yeremkin highlighted another risk: the prolonged maintenance of elevated key interest rates, with untimely monetary easing potentially placing significant constraints on economic expansion.
Anton Tabakh, Chief Economist at the rating agency Expert RA, believes the country’s economic growth this year will be at least 1.3%.
"We estimate GDP growth this year at around 1.3%, though we may revise this downward. For next year, we expect 1.6%. This year, the average exchange rate will likely hover around 85 [rubles per US dollar], moving toward 90 by year-end, though a lower figure cannot be ruled out. Next year, the ruble will be markedly weaker. The key interest rate will end this year at 16%, and in the following year at 12%," the expert said.
Comment from Economic Development Ministry
The press service of the Ministry of Economic Development told TASS that work is now being finalized on the macroeconomic forecast, which will be presented following government review.
"The forecast will adjust the main macroeconomic indicators compared with the April scenario assumptions, taking into account all current trends as well as domestic and external challenges. As for inflation, dynamics over the past few months provide grounds to believe the figure will be lower than previously expected," the ministry stated.