Russian macro: The economy at the crossroads: uncertainty ahead once again
This year is shaping up to deliver some unexpected macroeconomic results, with growth slowing sharply and GDP on track for around 1.0%, compared to 4.3% and 4.1% in the previous year and in 2023. Those stronger figures were largely the result of Rosstat’s substantial revisions to earlier data. While both the government and most analysts anticipated a slowdown this year, they didn’t expect it to be this steep. However, sentiment shifted down a few months ago as GDP in 2Q25 rose only 1.0%, with no signs of improvement, confirmed by just 0.6% y-o-y growth in 3Q25.
It’s worth remembering that Rosstat frequently revises past data, updating not just the figures but also the methodology. This means the current 2025 statistics could still change, and while revisions to the 2025 SNA accounts are possible, it’s certain the final growth number will end up dramatically below last year’s 4.3%.
This report mostly recaps points from earlier notes, with updates based on the latest monthly statistics. October’s data suggest modest improvements across several areas of the economy, with some sectors showing notably strong gains. We expect GDP growth to be somewhat stronger next year, but not by much, as the economy once again finds itself at a crossroads, with the efficiency of the current growth model in question. Looking beyond 2026 doesn’t seem worthwhile right now, since the coming year will likely be a time of adjustment for Russia’s growth model. Until there’s a clear direction on which path the country takes, making projections past 2026 could be misleading.
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