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Investing.com -- Russia’s economy expanded by 4.1% in 2024, a growth rate slightly higher than the official forecast of 3.9%, as reported by Russian Prime Minister Mikhail Mishustin to President Vladimir Putin on Friday.
The country’s gross domestic product (GDP) reached a record high of 200 trillion roubles ($2.06 trillion), further discussed during the meeting broadcast on state television.
President Putin expressed satisfaction with the economic performance, describing the results as "good" and "satisfactory". Nevertheless, he reiterated his desire for a reduction in the country’s inflation rate, which stood at a high 9.5% in 2024.
Putin also made a comparison with what he referred to as "so-called developed countries", pointing out that Russia’s economic growth outpaced those of the United States, Germany, and France in 2024.
Despite predictions from the West that the Russian economy would collapse under the weight of sanctions imposed due to the country’s conflict with Ukraine, the economy has proven resilient. Increased military spending has been a significant driver of growth, although it has also contributed to rising consumer prices.
Inflation has emerged as a significant challenge for Russia’s economy, impacting consumers who have witnessed an increase in prices for staple foods at supermarkets.
In response to the inflationary pressures, Russia’s central bank has kept its benchmark interest rate at 21%, the highest level in two decades. This measure aims to curb inflation, but high interest rates, coupled with labour shortages, have put a strain on the economy in recent months.
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