Representatives of the Russian Ministry of Finance and the Central Bank warned Putin about the threat of a budget deficit due to the war

The Ministry of Finance and the Central Bank of the Russian Federation have warned Putin that current spending on the war in Ukraine could lead to a budget deficit.

This is reported by Bloomberg, citing sources.

According to the agency, officials from the financial bloc are proposing to cut defense spending. At the same time, some of the leadership and officials close to the Kremlin are opposed to cuts in the military budget, because defense orders support the economy through government contracts.

According to Bloomberg, the Russian Defense Ministry is also asking for additional funding. According to the agencyʼs sources, the department may need an additional $36 billion this year.

In the first four months of 2026, the Russian federal budget deficit increased to $82.6 billion, or 2.5% of GDP. This is approximately 50% more than the target for the entire year.

At the same time, the Russian Ministry of Economy has downgraded its economic growth forecast for 2026 from 1.3% to 0.4%. Official statistics also showed a contraction in the economy in the first quarter, the first time in three years.

When preparing the budget, the Russian government expected that military spending could be reduced in the second half of 2026 if the war ended. However, this did not happen, so Putin instructed to first find options for cuts in other budget sectors, and then reduce war spending.

• In May, the Stockholm International Peace Research Institute (SIPRI) estimated that Ukraine ranked seventh in the world in military spending — in 2025, spending increased by about 20% — to $84.1 billion, or 40% of GDP.

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