Bank of Russia submits 2024 Annual Report to State Duma
Russia’s economy continued to evolve actively over the course of 2024. As a result of its extensive structural transformation, enterprises expanded their production capacities. Nevertheless, supply was lagging behind soaring demand. The Bank of Russia’s principal objective in these conditions was to tame price growth so as to avoid a situation where inflation would become a heavy burden on households and push up companies’ costs, Bank of Russia Governor Elvira Nabiullina emphasised in her address to the readers of the Annual Report.
In 2024, the Bank of Russia raised the key rate further to 21% per annum aiming to reverse the upward trend in inflation and bring it down in 2025. This policy stance helps cool down demand and mitigate the gap between the increase in demand and the growth rate of the economy’s production capacities.
‘The first months of 2025 suggest that the economy is gradually restoring this balance. Price growth is decelerating, while the economy is still growing, although at a more moderate pace. In other words, production capacities continue to expand, while the increase in demand is becoming more balanced, without provoking a further acceleration of inflation and depreciation of the ruble,’ Elvira Nabiullina stated.
A gradual return of inflation to the target will give another boost to the economy and protect people’s incomes. The banking sector has been an important contributor to the evolution of the economy, including the advancement of top-priority industries. Despite the sanctions, banks continued to process cross-border settlements and lend to the economy. Nonetheless, bank lending is not the only way to raise funding – one of the alternatives is the capital market. The Bank of Russia and the Government will promote conditions that will encourage initial public offerings.
‘The Bank of Russia’s activity is dedicated to two closely related objectives which are to protect households’ incomes and foster conditions for sustainable growth of the economy. This is only possible with low inflation, a reliable banking system, and a well-developed financial market where people’s rights are properly protected,’ Elvira Nabiullina emphasised.
The Annual Report presents the main results of the Bank of Russia’s work and contains its financial statements and auditors’ reports. Simultaneously with its Annual Report, the regulator releases an abridged version for the general public – The Bank of Russia’s Work: Results in Brief for 2024.