The IIF said in its assessment that the Russian economy following its invasion of Ukraine did not foresee a truce in the war and that sanctions would likely be broadened in the coming months.
While Russia's economy is weakening and its people's purchasing power is decreasing, a jump in oil and gas prices – the main Russian exports – has pushed the country's current account surplus to record levels in recent months, Reuters stated.
According to the IIF, Russian gross fixed capital formation would fall by 25% in 2022, while imports will fall by 28% and exports will fall by 25%.
Nonetheless, the finance center said that the sanctions "are unraveling its economy, wiping out more than a decade of economic growth, and some of the most meaningful consequences have yet to be felt.”