World Bank retains forecast for Russia's GDP to grow 0.8% in 2026, lowers outlook to 0.7% for 2027

MOSCOW. April 8 (Interfax) - The World Bank has retained the forecast for Russia's GDP to grow 0.8% in 2026.

The World Bank has lowered the forecast for the country's GDP to grow to 0.7% in 2027 from 1% expected in January, the bank said in its updated economic outlook for emerging market countries in Europe and Central Asia.

The estimate for growth in Russia's GDP for 2025 has risen to 1% from 0.9%.

Experts from the World Bank predict that Russia's GDP will slow down its growth this year despite the recent price hike for oil and gas. The bank's baseline scenario assumes that the increase in the cost of fuel will be temporary.

"Fiscal space is likely to remain narrow amid the sanctions and the ultimate reduction of energy prices," the report reads. "The federal budget deficit reached 1.5 percent of GDP in the first two months of 2026 or over 90 percent of the annual target. Any windfall gains from higher oil and gas revenues are likely to be used to contain the deficit, rather than finance additional spending."

The bank also predicts that tough financial conditions, increased taxes and structural constraints will also hold back the growth of the Russian economy.

The World Bank lowered its forecast for the GDP of developing economies in Europe and Central Asia in 2026 from 2.2% to 2.1% and from 2.7% to 2.3% in 2027. It forecasts the region's growth rate at 2.9% this year excluding Russia, the lowest since 2020.