Rising prices caused by a drop in the value of the ruble are bringing Russia’s war — and the impact of sanctions — home to many Russians for the first time.
“Objective data shows that inflationary risks are increasing, and the task of reining in price growth is now the number one priority,” Putin said, with a note of tension in his voice. “I ask my colleagues in the government and the Central Bank to keep the situation under constant control.
With imports still making up to 40 percent of the average Russian consumer basket, two recent surveys show Russians have already started to reduce spending. One published Aug. 16 by Russia’s largest market research agency, Romir, found that 19 percent of respondents had begun cutting back on purchases of basic goods such as toothpaste, washing powder and food in July, compared to 16 percent the month before.
At the same time, Russia’s turn to gray import channels to avoid export controls — through countries such as Turkey, China and Central Asian states — have brought imports back to prewar levels, further putting pressure on the ruble. Oleg Ustenko, an economic adviser to Ukrainian President Volodymyr Zelensky, said it is imperative for the West to take collective action. “We need significant downward pressure on the price cap, or the Russians will have enough cash on hand to continue this war,” Ustenko said.
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