Russian Business Climate Index declines, price expectations ease in March
The Bank of Russia's Business Climate Index declined to -0.1 points in March, down from 0.2 points in February, driven by lower estimates of output and demand. Companies' price expectations for the next three months also eased to 5.0 percent.
Business Climate Index shows weakening trend
The Bank of Russia's Business Climate Index (BCI) declined to -0.1 points in March, down from 0.2 points in February.
This decrease was primarily attributed to lower current estimates of output and demand across various industries.
While BCI values varied significantly by sector, the main contribution to the overall decline came from mining and quarrying, and services.
Current estimates of the business climate reached their lowest levels since May 2022, with noticeable changes observed in services and construction.
Despite this, short-term expectations of companies for the next three months increased in March, returning to the level observed in Q3-Q4 2025, with agriculture and manufacturing showing the highest positive outlook.
Investment expands, staff shortages ease
In Q4 2025, companies continued to expand their investment activities, recording the highest growth rate for the year.
Businesses anticipate further investment growth in Q1 2026, albeit at a slower pace than the 2025 average.
Despite these investments in new capacities, the capacity utilisation rate continued to decline in Q4 2025, though it remained significantly above 2017–2019 levels.
Staff shortages also gradually decreased in Q4 2025, yet staffing levels remained extremely low compared to the period before 2022.
Recruitment expectations for Q1 2026 became the most moderate since Q3 2022, while still remaining positive.
Mixed signals for monetary policy
The latest business monitoring report presents a mixed picture for the Bank of Russia, with weakening current activity but easing price pressures.
While the decline in the BCI suggests a cooling economy, the persistent investment growth and easing staff shortages indicate underlying resilience.
This data provides the central bank with more flexibility on future policy decisions, potentially allowing for a more cautious approach to rate adjustments.
Source: 'Monitoring of Businesses' No. 3 • March 2026
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