EC forecasts Russia's GDP to grow 3.5% in 2024, under 2% in 2025-2026

BRUSSELS. Nov 15 (Interfax) - Russia's economy should grow 3.5% in 2024, the European Commission said in its overview for autumn, having raised its spring outlook upward from 2.9%.

The EC has revised its estimate upward to 1.8% for 2025 from 1.7%.

Russia's economy should also rise 1.6% in 2026, according to the EC.

"Economic activity is projected to slow for the remainder of the year and weaken further in 2025 and 2026 following unexpectedly robust growth in GDP in the first half of 2024. Inflation has been rising for much of 2024, though it is expected to begin to decelerate amid the persistently tight monetary policy," the EC said.

"The recent tax increases should support non-energy revenues, assisting to contain the budget deficit despite the increased expenditures" related to the military situation.

"Consequently, public debt is projected to increase only marginally by the end of the forecast horizon," the EC believes.

Russia's consumer prices should expectedly rise 8.1% in 2024, with inflation then decelerating to 5.7% next year and 4.5% in 2026.

The EC forecasts Russia's budget deficit at 1.8% of GDP this year and 1.5% of GDP in 2025, then expectedly rising to 2.5% of GDP in 2026, including owing to slower growth in the economy and reduced revenues.

Russia's public debt totaled 19.7% of GDP in 2024, and it should be 20.2% of GDP next year, then 22.1% of GDP in 2026, the EC said.