Vladimir Putin, the Russian president, said on Thursday that Russia’s economy was overheating and that inflation was a major problem.

In comments translated by Reuters, Putin stated that “there are certain issues here: inflation, a certain heating up of the economy and the government is already tasked to bring the tempo down.”

In November, the consumer price index in Russia was 8.9% higher than it had been in October. The rise was primarily due to rising food costs, particularly milk and dairy products.

The weaker ruble, following the new U.S. Sanctions in November, has also fuelled inflation and increased import costs into Russia. A massive increase in military expenditure has led to shortages of labor, production and supply elsewhere, which have driven up prices and prompted workers demand higher wages.

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Putin’s comments, reported by Interfax but translated by Google, continued: “It is obvious that inflation is an alarming sign.”

“Last night, as I prepared for today’s conference, I spoke to Elvira Nabullina, the Chairperson of the Central Bank. She told me it was around 9.3%. “But wages have grown 9% in real-terms, and I would like to stress this — in real-terms minus inflation. And the disposable income has also increased,” he said.

On Friday, the Russian central bank will likely raise its benchmark interest rate to 23%, the highest in over a decade. This is up from 20% during the 2022 invasion of Ukraine.

Putin attributed the price increases to international sanctions, but appeared to criticize his central bank. He said that experts had suggested other tools, besides interest rates, could have been used by the central banks to control inflation.

“Ofcourse, external restrictions, sanction, etc., also have an effect to some extent.” “They are not important, but [they are reflected] in some way or another (in the increase in prices), because they make logistic more expensive,” said the head of the state, according to comments reported and translated by Google by the news agency Tass. “But there are subjective [factors] and our shortcomings.”

“We should’ve taken these timely decisions. “It is a bad and unpleasant thing to see prices rise, but by keeping macroeconomic indicators we can cope with it,” Putin said.

He said that both the Russian government and central bank had a responsibility to deliver a “soft-landing” for the economy. The Russian central banks, he added, were responsible for ensuring a good performance of the overall economy.

The International Monetary Fund (IMF) predicts that Russia will grow by 3.6% this year before slowing down to 1.3% in 2025.

IMF says that the “sharp” slowdown is expected “as private investment and consumption slow, amid reduced tightness on the labor market and lower wage growth.”

Putin said on Thursday that the Russian economy will grow by a rate of 2-2.5% in 2019.