IMF predicts possible economic recession in Russia

After the sanctions that Russia has received after starting the invasion of Ukraine, the International Monetary Fund (IMF) warns that Moscow may fall into "a deep recession" so they do not rule out bankruptcy in its institutions.

According to statements by Kristalina Georgieva, managing director of the IMF, it is not that Russia does not have money, the problem is that it will not be able to use it due to the blockade that makes some transactions impossible.

According to Georgieva, they do not want to get ahead of events, but "I just want to say that we do not talk about Russia's default as an unlikely event anymore", while also informing that the IMF does not currently maintain any relationship with Russia and the office in Moscow it is closed.

In the same order of ideas, he emphasized that it is “unlikely” that the government of Vladimir Putin will be able to have access to the special drawing rights ( SDR ) due to the sanctions, so the only option he will have is to go to some financial intermediaries…

Likewise, the IMF representative analyzed that the Russian economy is already going through a crisis that could increase inflation, which leads to a reduction in purchasing power, thus affecting the entire population.

The duration of the war will be decisive to measure the impact of the sanctions on the Russian economy since it is expected that when an agreement is reached to cease the invasion, the blockade will be lifted, and thus Moscow will be on the way to improvement.

The war and its impact on the European economy

The director of the IMF also indicated that the armed conflict in Ukraine, plus the sanctions against Russia, could affect the economy of neighboring countries and even worldwide.

Among the secondary effects is the increase in raw materials, a reduction in income caused by inflation that is already observed in some nations, especially the rise in oil prices worldwide.