Less than six months ago Vladimir Putin seemed invincible. Russia’s president had triggered a clamour of outrage across Europe by annexing Crimea from Ukraine. None of the sanctions imposed by western governments in response looked likely to make him change course. At home, his popularity ratings rose to an all-time record of 88 per cent.
These months of triumph seem long ago. The collapse of the rouble late last year following the steep drop in oil prices has pushed Russia into crisis mode.
The government expects the economy, which grew by 0.8 per cent last year, to contract by at least 4 per cent in 2015. Moscow has already committed more than Rbs590bn ($9.7bn) to prop up banks and large companies in the wake of the rouble rout and more dark clouds are gathering on the horizon. The rating agency Standard & Poor’s is considering downgrading Russia’s sovereign rating to junk status.