Western officials would no doubt like to credit their own sanctions for the stagnation of the Russian economy, but data released by Deputy Economy Minister Andrei Klepach today suggests their economic growth was already virtually nil.
Not that the acrimony surrounding regime change in Ukraine and secession in Crimea hasn’t had some effect too, as the ministry released other figures showing inflation is up to nearly 7% this month.
That’s a function of the Russian ruble losing value, and Klepach confirmed a capital outflow close to $70 billion during the first quarter, up around 10% from the previous year, and likely driven by fear that a sanctions war could make getting money out of the country harder in the future.
For most of the past year a US dollar was worth 30-32 rubles, but since the violent Ukraine protests the number has spiked, and is now just over 36 rubles. Russia briefly hit a similar level in February 2009, but quickly recovered.
