At a time when the Russian economy is somewhere between stagnation and recession, ordinary citizens are beginning to feel the cost of the Kremlin’s aggression, writes the BBC.
Prices for almost all basic necessities have risen, including eggs and vegetables. Alexander, an advertising specialist living in Moscow, saw his monthly food expenses rise by 22% in just one month, from 35,000 rubles (450 dollars) to 43,000 rubles (555 dollars). Coffee on the way to work suddenly became 26% more expensive.
The fact that the man’s cafe has not closed its doors yet may also be a matter of time. The news agency Reuters writes that restaurants and cafes in Russia are closing at the fastest pace since the invasion of Ukraine, and consumer purchasing power has fallen even in the most affluent Moscow. Closed cafes and dark shop windows are visible in both Moscow and Vladivostok on the Pacific Ocean, 6,500 kilometers to the east, and indicate a significant economic downturn.
The BBC writes that prices in Russia have been rising since the Kremlin’s full-scale invasion of Ukraine four years ago, fueled by the state’s war sponsorship and defense spending, which take up the lion’s share of the state budget. This in turn has led to rapid economic growth and raised living standards. Until now, most residents have not noticed the high level of inflation, especially in the big cities of Moscow and St. Petersburg. The large amount of money and
spending has masked the growing economic consequences of the war, the withdrawal of foreign investors and Western sanctions.
However, in 2025, economic growth slowed significantly, and wages could no longer keep up with inflation, and price increases began to hit wallets. In turn, at the beginning of 2026, prices in supermarkets increased by 2.3% in less than a month. Since the beginning of the year, everything has become more expensive – from meat and yeast to medicines and utility bills.
Since 2019, the BBC has been buying the same 59 basic products every other January at one of the Moscow stores of the supermarket chain Pyaterochka. The purchase includes vegetables and fruits, dairy and meat products, canned foods, instant noodles, sweets and drinks, including beer. In 2024, such a purchase cost 7,358 rubles (83 dollars), and in January this year – 8,724 rubles (112 dollars). The most significant price increase has hit fruits and vegetables. Russia relies heavily on imported fruit and vegetables, so prices in stores are subject to fluctuations in the ruble exchange rate and disruptions in supply chains. The invasion of Ukraine has caused both.
At the same time, prices for dairy products have also risen significantly – by 41%. They are usually produced locally, but the
dairy industry has been hit by rising farm maintenance costs, loans with huge interest rates, and a shortage of workers.
One of the latest developments that has had an impact on prices in Russian stores is the increase in value-added tax from 20% to 22%. The tax increase is directly related to the war in Ukraine, and the Russian Finance Ministry has indicated that it is necessary to finance national defense and security.
While Muscovite Alexander told the BBC that he was not going to change his eating habits, others had to. 68-year-old Nadezhda said that she could no longer afford to buy beef and had to buy the cheapest fish. A woman and her husband live in Moscow, and both live on state pensions and her husband’s extra income. She said that almost all of her pension is used to buy food, which means that other expenses have to be postponed. The couple had been saving for car repairs, but they have had to use their savings for food. Her husband also has to postpone a new winter jacket until next year.
A marketing specialist in Moscow has started paying attention to supermarket promotions, and she has also had to use her savings. She and her husband can no longer afford to eat out, but the cost of dinner at home has almost doubled.
One of the biggest blows to the Russian economy this year could be related to oil.
The federal budget is based on the assumption that oil prices are high, but even since the beginning of 2026, the market price has fallen, and an increase is not expected. Oil exports have also been hit by US sanctions, which have reduced the flow of oil to one of Russia’s main trading partners, India. This means that the Russians will face a larger budget deficit than they had planned.
Borrowing is a difficult option, given the high interest rates. Few countries want to lend to the Kremlin, which continues to wage war and is known as an unreliable cooperation partner. Therefore, Moscow will have to use other ways – further tax increases, or cutting spending, mainly in the area of public services.
Tatyana Mikhailova, an economist and visiting assistant professor at Penn State University, pointed out that the overall trends indicate a move towards stagnation and even a possible decline in GDP. There is currently no sign of an economic recession, but Mikhailova believes that it is very possible.
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