Russia economic crisis sparks furious war of words among Kremlin elites | World | News
The Kremlin has been gripped by vicious infighting over the economic crisis, as tensions between competing factions explode.
Business elites are furious with the head of Russia‘s Central bank Elvira Nabiullina, after she hiked interest rates to a record high of 21 percent.
Inflation in Russia is running at 9.5 percent, and Ms Nabiullina is keen to bring it under control as fast as possible.
Last week, the Central Bank decided to hold interest rates at the present level, and hinted further increases could be on the way in the New Year.
Her critics argue that the high rates are putting the brakes on business activity and the economy, by making it more difficult for companies to borrow money to operate and invest.
They include many closely connected to the Kremlin, such as Sergei Chemezov, the head of the defence conglomerate Rostec, as well as steel magnate Alexei Mordashov.
Now Ms Nabiullina is reportedly facing even more opposition from Kremlin hardliners over her plans to apply for an IMF (International Monetary Fund) bailout.
Kyrylo Shevchenko, a former hard of Ukraine‘s National Bank, said on his X account: “Elvira Nabiullina, Russia’s Central Bank governor, finds herself at the heart of an ideological storm.
“She argues that the Russian Economy cannot endure without IMF aid—a notion bitterly opposed by Moscow’s conservatives, who still revel in the country’s debt-free past.
“Her attempts to broach the topic have been met with fierce resistance from pro-Kremlin hardliners, leaving her politically embattled.”
He added: “The irony? The IMF, wary of geopolitical entanglements, likely has little appetite for this saga.
“Of course, the clearest path to saving Russia’s economy isn’t an IMF bailout.
“It’s ending the war. But even peace won’t erase the damage overnight.”
It comes as prices for staple food items continue to spiral out of control, amid growing public anger.
Prices for potatoes have soared by a staggering 78 percent, while those for cabbage, beetroots and butter have also jumped by between 27 and 31 percent.
And things look set to get worse for consumers, as Russia faces up to an “unprecedented” winter crop disaster, which could drive up food prices even higher.
