The Russian central bank has raised interest rates for the first time in almost a year and a half. According to policymakers in Moscow, this step was necessary to prevent inflation from rising too fast.
The key interest rate increases to 8.5 percent from the previous 7.5 percent.
The invasion of Ukraine makes everyday life more expensive for many Russians. This is partly due to the gigantic government expenditures associated with the war.
There is also a shortage of personnel because many Russians are being called to the front, and international sanctions lead to shortages of many products, which also drives up prices.
The failed uprising of Wagner mercenaries led by Yevgeny Prigozhin also increased concerns about price stability in Russia.
The great uncertainty surrounding the mercenary army’s short-lived advance caused the ruble’s exchange rate to fall, making imported goods even more expensive.