FX.co ★ Russian Budget Gap Widens to 1.5% in Jan-April

Russia's fiscal shortfall expanded to 3.2 trillion roubles (approximately USD 39.6 billion), or 1.5% of GDP, in the initial four months of the year, an increase from 0.6% during the same timeframe last year, according to preliminary data from the finance ministry released on Wednesday. This increase is attributed to heightened budget expenditures in January alongside a decrease in oil and gas revenues. Nonetheless, the ministry assured that this would not impede the achievement of structural balance targets set for 2025. During the aforementioned period, fiscal spending escalated by 21% compared to the previous year, reaching 15.5 trillion roubles and accounting for 36.6% of the total annual spending plan. At the same time, budget revenues rose 5%, with oil and gas revenues declining by 10.3%, while revenues outside the energy sector increased by 13.5%. In light of these developments, Russia's finance ministry revised the 2025 budget deficit projection to 1.7% of GDP from a previous estimate of 0.5%. This revision follows a downward adjustment in the forecast for energy revenues by 24%, driven by expectations of prolonged low oil prices.