Nabiullina: Putin's economic confidant in times of war and turmoil

Elvira has the exclusive right to tell the president what he doesn't like. She can openly talk about the situation, and he accepts it, said Prof. Oleg Vyugin, an economist and former head of the Moscow Exchange, to Bloomberg. Elvira Nabiullina is the head of the Russian central bank, bearing the weight of the Russian economy on her shoulders.

She is one of the most influential people in Russia. The President of the Bank of Russia, Elvira Nabiullina, keeps the country's wartime economy ruled by dictator Vladimir Putin in check. And she increasingly disagrees with the policy pursued by the Kremlin.

According to Prof. Vyugin, Nabiullina is the only one who can say what Putin himself would not want to hear. The 71-year-old Vyugin has known Nabiullina for over 20 years, having been the deputy president of the Bank of Russia himself in 2002.

Bloomberg emphasizes that Putin has changed ministers and generals since the invasion of Crimea in 2014. The only person who has consistently remained in position is Nabiullina, "without whom he cannot do."

Bloomberg believes her bond with Putin may define the economy that emerges from Europe's most significant military conflict since World War II.

Nabiullina stands out in Putin's closest circle for her nonconformity, not loyalty above all. The head of the central bank is even under Putin's protective umbrella. There are many opponents of Nabiullina in the Kremlin, but Putin won't let her be moved. She is one of the few women in top positions in Russia and has been managing the Bank of Russia since mid-2013.

According to Bloomberg sources, Putin "values and trusts" Nabiullina. Her economic advice is meant to balance other opinions in the Kremlin. The main issue is the shift of the economy to a wartime footing. Finance Minister Anton Siluanov believes the goal of the Russian budget should be "to ensure victory." Another Putin supporter, Maxim Oreshkin, who served as the Minister of Economic Development of Russia, stated that the war in the east is actually "a global conflict with the West over Ukraine." Additionally, Russian Prime Minister Mikhail Mishustin regularly complains about her.

Nabiullina has a different view. She warns, for example, about labour shortages, referring to the hundreds of thousands conscripted into the army. In her opinion, the record defence budget will negatively impact the economy. This year, Moscow is expected to allocate 6% of GDP to the military, compared to 3.9% in 2022 and 2.7% in 2020.

Bloomberg adds that even before the invasion, Russian officials mocked Nabiullina for her monetary policy approach, which focused primarily on inflation.

It is unclear how long Nabiullina will maintain such a strong position in the Kremlin. Russia's military spending is continuously increasing, and the war with Ukraine could last for years. In such a situation, the head of the central bank may end up on the sidelines.