How Russia’s economy changed in 2025

Hello! Welcome to your weekly guide to the Russian economy, written by Alexandra Prokopenko and Alexander Kolyandr and brought to you by The Bell. This week we bring you a state of the nation rundown, a look at the condition of Russia’s economy as it enters 2026.

Thank you for being with us throughout the past year. After a short break for the Christmas and New Year holidays, we will return with our newsletters on January 9. Merry Christmas and happy holidays!

Costs of war show no signs of subsiding in 2026

Russians recently voted “anxiety” as their Word of the Year in one online poll, a decision the organizers said accurately reflected the emotional state of society. There is certainly plenty to worry about. Putin doesn’t seem to be thinking about ending the war, repression is escalating, and there’s a growing sense of insecurity. In Oct. 2025, just 7% of Russians said the invasion – or “special military operation” – was having a positive impact on their lives, while 43% said it was negative. The economy does not inspire optimism. Right now, it resembles an automobile stuck in neutral while the engine roars: military spending puts the pedal to the floor, the budget burns through the gas, but nothing moves. Shifting gears is only possible via political decisions that the Kremlin is not willing to make.