Russia faked economic data to appear more resilient to its war and sanctions, intel report says

By Emma De Ruiter & Dimitri Kavalerov

Published on 21/04/2026 - 13:04 GMT+2

Russia has been manipulating its economic data to hide the real state of its economy amid the ongoing invasion of Ukraine, Sweden's military intelligence said on Monday.

Swedish Military Intelligence and Security Service (MUST) said that while official Russian figures did show falling GDP and weak industrial production, they were presented in a way that made the country "appear more resilient than it really is".

Russia is likely suffering from "higher inflation and a larger budget deficit" than it was communicating, it added.

"Despite the recent period of high oil prices, which has provided Russia with increased revenues, it would take a price of over $100 per barrel for an entire year to remedy the Russian budget deficit," MUST said.

At the same time, "the weak economy does not affect the strategic objectives" of Russia's ongoing war in Ukraine, according to Thomas Nilsson, head of MUST.

The intelligence service said that Russia was committed to continuing the war as well as conducting "hybrid" activities in EU and NATO countries.

"It is a political decision, not an economic one. However, the economic constraints and sanctions do affect what kind of military capabilities Russia can muster, and how quickly this can be done," Nilsson said.

'Long-term recession or shock'

According to Nilsson, the real inflation rate in Russia is closer to the key interest rate of 15% than to the Russian Central Bank's official estimate of 5.86%.

"The Russian economy can only go on one of two scenarios: long-term recession or shock," Nilsson said. "In either case, it will continue on a downward trajectory towards financial disaster."

According to Nilsson, Russia is now "living in debt," and Stockholm has recorded financial indicators that could point to an impending banking crisis.

Meanwhile, international estimates largely coincide with the Russian Central Bank's forecast that inflation will slow to about 5% by the end of this year.

At a recent government meeting on economic issues, Russian President Vladimir Putin downplayed the statistics, stating they represented "generally expected trends".

Putin linked the downturn to "calendar, weather, so-called seasonal factors" of the winter period, which are "far from only" to determine economic results.