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Sustainable budget policy creates room for rate normalization — Novak

TASS reports: Predictable and sustainable budget policy creates room for reducing inflation risks and normalizing interest rates, Russian Deputy Prime Minister Alexander Novak said in an interview with Vedomosti. "Balancing the budget is also a condition for the consistent easing

BRIC Team
BRIC Team
May 12, 2026 · 2 min read
Originally reported by TASS

Key Takeaways

  • •TASS reports: Predictable and sustainable budget policy creates room for reducing inflation risks and normalizing interest rates, Russian Deputy Prime Minister Alexander Novak said in an interview with Vedomosti.
  • •It also means choosing the most effective tools in terms of the cost-result ratio.BackgroundThis work is underway and will continue throughout the entire budget cycle," the deputy prime minister said.
  • •This story has been edited and re-presented by BRIC Team.
  • •"Balancing the budget is also a condition for the consistent easing of monetary policy, which means expanding opportunities for economic growth.

TASS reports: Predictable and sustainable budget policy creates room for reducing inflation risks and normalizing interest rates, Russian Deputy Prime Minister Alexander Novak said in an interview with Vedomosti. "Balancing the budget is also a condition for the consistent easing of monetary policy, which means expanding opportunities for economic growth. The more predictable and sustainable budget policy is, the more room there will be for reducing inflation risks and gradually normalizing rates," he noted.

According to Novak, the government faces the task of balancing the budget amid declining revenues — primarily due to the strong ruble exchange rate and a period of low oil prices — and growing spending needs, including expenditures related to defense and security. "The main task here is prioritizing expenditures, focusing on the most effective areas that deliver the greatest return, such as technological leadership projects. It also means choosing the most effective tools in terms of the cost-result ratio.

Background

This work is underway and will continue throughout the entire budget cycle," the deputy prime minister said. He also stressed that all expenditures related to technological leadership, in addition to having a significant impact on economic growth, will have a strictly disinflationary effect in the long term. "Because they will reduce our dependence on disruptions in external supply chains and increase the supply of high-tech products within the country," he said.

Key facts

  • "Balancing the budget is also a condition for the consistent easing of monetary policy, which means expanding opportunities for economic growth.
  • The more predictable and sustainable budget policy is, the more room there will be for reducing inflation risks and gradually normalizing rates," he noted.
  • "The main task here is prioritizing expenditures, focusing on the most effective areas that deliver the greatest return, such as technological leadership projects.

Originally reported by TASS. This story has been edited and re-presented by BRIC Team.

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