Russian banks are allegedly trying to arrange financial assistance with the authorities in Moscow, because the increasing number of debtors cannot repay loans – which is a clear sign that the war leaves serious consequences for the economy of the Earth.
According to Bloomberg News, at least three largest banks in the country seek salvation from the state, which is the latest indicator of large financial problems caused by the invasion of Ukraine.
Apparently state officials ordered banks not to publish the exact amount of bad loans, but to “create their books” creatively “to show a healthier picture of the condition. However, this tactic can only mitigate problems in short term, so the state intervention is becoming increasingly certain.
Putin’s war in Ukraine Russia costs expensive. Strengths are sharp sanctions of the West, the country faces labor loss due to mobilization and mass departure of people abroad, and the additional stroke occurs due to the falling price of the oil income for the Russian state.
Last year, the Russian economy recorded a growth of 4.3 percent, but only because the state is massively directing funds into the war industry. Today, every third-party from the state budget goes to the army, investor me.
On the other hand, the private sector is seriously affected. Procurement Manager Index – a key indicator of the private sector activities – has fallen to the lowest level since the beginning of the war, which indicates a decline in business dynamics.
It is envisaged that this year will reach a sudden slowdown in economic growth. Goldman Sachs analysts expect GDP to increase only 0.5 percent – despite enormous military expenditures.
Food prices grow suddenly, and the lack of workforce further encourages inflation, which reached two-digit values. Citizens barely manage to buy basic living foods – even potato became deficient.
The Central Bank is difficult to maintain control over the situation, despite record interest rates of 20 percent. At the same time, the state budget was burdened due to large bonuses and high salaries that are paid to soldiers – a measure that temporarily relieves social tensions among soldiers families, but the overall finances exacerbate.
Oil export revenues have fallen for a third compared to last year, because the price of barrels of crude oil in the world market – which is no longer fully accessible to Russia – fell from $ 85 to only $ 67.
Goldman Sachs also predicts that the laundry could deprecate as much as 30 percent compared to the dollar during this year, which would further increase the costs of imports and amplifier inflationary pressures.
