Russia's economy undergoing period of 'controlled cooling', inflation slowing - Deputy PM Novak

MOSCOW. Feb 11 (Interfax) - Russia's economy is in a phase of "controlled cooling", searching for a balance in the dynamics of key indicators, with the pace of lending and growth in GDP slowing, and inflation is slowing as well, Deputy Prime Minister Alexander Novak said on Tuesday at a meeting of the Federation Council committee.

"We are currently in a period of, so to speak, 'controlled cooling' in the economy, searching for a balance between the task of curbing inflation and ensuring economic growth. The pace of growth in GDP was lower in the fourth quarter than at the beginning of the year, namely, a slowdown is occurring, and primarily industries oriented toward domestic civilian demand and exports are slowing. Strict monetary policy is being implemented to ensure a deceleration in inflation, and macro-prudential regulation on the part of the Central Bank of Russia has been tightened, thus we are accordingly also seeing a gradual slowdown in the rate of consumer, mortgage and corporate lending," Novak said.

"It is important today to ensure a balance between the pace of economic growth and the tasks associated with curbing inflation as part of the strict monetary policy and economic policy being pursued," Novak said.

Novak said that the pace of inflation had already "slowed somewhat" from 0.22%-0.25% to 0.16% in recent weeks. "The measures being implemented have a curbing effect on inflation," he said.

Novak said that according to an estimate by Rosstat, Russia's GDP grew 4.1% in 2024 and 4.1% in 2023 also, adjusted from 3.6%.

He said GDP in nominal terms had doubled to 200 trillion rubles in 2024 from 107 trillion rubles in 2020.

"We plan to attain GDP of about 300 trillion rubles by 2030, that is, to triple the figure compared with 2020," Novak said.

The Central Bank of Russia is currently forecasting 0.5%-1.5% GDP growth for 2025 but will unveil an updated forecast on February 14. Novak said at the end of December that the government was expecting 2.0%-2.5% growth this year. Analysts polled by Interfax at the end of December are forecasting 1.5% growth.