British military intelligence has affirmed that the height of inflation and high interest rates threaten Russia’s ability to maintain high levels of defense expenditure.
In its last update on the war in Ukraine, the United Kingdom Ministry of Defense (Mod) suggested that Moscow could fight to maintain its war effort due to the pressures on its economy.
“It is very likely that long -term inflationary pressure will exacerb statement.
The British intelligence landfill said last month, the Central Bank of Russia (CBR) decided to keep interest rates at its highest level in more than two decades, after having risen to 21 percent from 8.5 before the invasion of Ucrine in 2022.
The MOD said that high interest rates, together with the increase in government expenditure and labor shortage, probably indicate that inflation will remain above the CBR target level of four through the rest of the year.
London also predicted that interest rates suggest that more corporate breaks will probably increase in the coming months.
The Ministry of Defense said that after the increase in October interest rates, inflation in the Russian economy increased from 8.5 percent to 10.1 percent.
In addition, from the collapse of the Russian Rublo currency at the beginning of the invasion of Ukraine in 2022, when it fell to 114 per US dollar, since then it has recovered to a maximum of 81 per USD last month.
“The appreciation of the ruble will probably reduce federal income of oil and gas, in oak terms, increasing pressures on the federal deficit,” the mod of Britain predicted.
The precarious state of the Russian economy can exert more pressure on Vladimir Putin to negotiate the end of the conflict in Ukraine.
kyiv and his European sponsors have accused the Kremlin of storage in the ongoing peace negotiations led by the White House of the president of the United States, Donald Trump.
While the Ukrainian president, Volodymyr Zelensky, said that his team was willing to accept a high unconditional fire, Moscow demanded that international sanctions, such as those of the Russian banking system, were raised before agreeing any truce.
According to reports, President Trump, on the other hand, said he is “angry” about Putin’s delays and warned that the United States can impose “secondary tariffs” to Russian oil by taxing third party countries that buy Russia’s energy. The novel strategy has already discouraged others, such as China, to buy oil from the dishonest socialist state.
