Russia's economy is booming, but this could all come crashing soon

The Kremlin has pumped so much money into the economy that it's creating a boom — but this house of cards could topple anytime soon

she also expressed concerns about inflation and the tight labor market due to Putin's military draft. She repeated her concerns about price rises and the labor shortage in her July rate hike announcement.

Ariel Chernyy, an economist at Italian bank UniCredit, forecasts Russia's GDP to grow by 1% this year — reversing a 2.1% contraction last year, according to a July 6 note seen by Insider. Chernyy said the country's economic resilience is due to government spending and the implementation of import-substitution projects that are boosting the domestic industry.

But it"does not mean a higher GDP growth rate that can be sustained in the long term" due to a shrinking labor pool and other issues like inferior import substitutes, he added. Subscribe to push notifications

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