Russia's economic outlook.
According to Russia's Central Bank, at the end of June, Russia's gold and foreign exchange reserves totalled 362 billion dollars. The current recession in Russia is not turning into the dramatic downturn that some had forecast. However, a different concern is being raised by Russian leaders: a fear of stagnation in the longer term. They do not use that term in its usual meaning of zero growth; the concern is rather that Russia will fail to keep pace with the rest of the world and it will grow more slowly than the global economy as a whole. The prospect of a sluggish economy concerns both the leadership and the population.
It will be difficult for Russia to fulfil the military reform programme without lowering other spending as finances remain tight.
Public unrest over economic conditions is likely; whether this translates into protests against Putin himself depends on his durability.
The Reserve Fund and the National Welfare Fund will be drawn down to support the budget and domestic investment.
