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The Russian economy has slowed sharply in recent months, according to the latest economic data, and may be at further risk if a fall in oil prices and global market turmoil persist. Russia's growth, fuelled by spending on the three-year-old war in Ukraine, exceeded 4% in the past two years, but a labour shortage across many other sectors has contributed to a wage-price spiral that has pushed inflation above 10%. In response, the central bank has raised its key interest rate to 21%, the highest level since the early 2000s, prompting howls from business leaders who say it is stifling...

President Vladimir Putin has grown increasingly concerned about distortions in Russia's wartime economy, just as Donald Trump pushes for an end to the Ukraine conflict, five sources with knowledge of the situation told Reuters. Russia's economy, driven by exports of oil, gas and minerals, grew robustly over the past two years despite multiple rounds of Western sanctions imposed after its invasion of Ukraine in 2022. But domestic activity has become strained in recent months by labour shortages and high interest rates introduced to tackle inflation, which has accelerated under record military spending. That has contributed to the view within a...

Russia's proposed tax hikes for companies and the wealthy, which may add an extra $30 billion to next year's budget revenues, will allow Moscow to further ratchet up spending, including on its war in Ukraine, without compromising fiscal stability. The finance ministry insists the tax hikes, proposed on Tuesday, are fair and target Russia's wealthiest. It says tax changes should solve national problems, reduce inequality and help develop Russia's regions. The changes will cover President Vladimir Putin's more than 11.5 trillion roubles ($128 billion) in infrastructure and social spending pledges for his new six-year term, analysts say, without requiring a...

Russian authorities are facing some unpalatable options as they try to keep the economy afloat - unless they can persuade President Vladimir Putin to curb massive military spending. Officials fear that without limiting the defence budget, the government will have to raise taxes, increase the pension age or print money to prevent the state deficit from running out of control. Despite a crisis brought on by diving oil markets and Western sanctions, they believe Russia can muddle through next year provided the price of crude, its dominant export earner, holds near current levels. But even at $60 per barrel, the...