Central Bank warns against mass distribution of money to Russians

If uncontrolled mass distribution of money to the population starts, people will not become richer, as such an approach only increases the rate of inflation. This is stated on Thursday, December 26, in the answers of the Central Bank of Russia (CBR) to the most popular questions from users.

As noted in the Central Bank, the above logic can successfully work only in relation to a specific person. Thus, if someone alone is given 1 thousand rubles as a gift, the person will indeed become richer and will be able to buy more necessary goods.

"But on the scale of the entire economy, this logic does not work. Imagine that the state prints and distributes Br1,000 to all citizens. But there will be no increase in goods in the economy at that moment. That is, the supply of goods will remain the same, while the effective demand for them will immediately increase," stated in the Telegram-channel of the regulator.

As a result, sellers will simply start raising prices, and consumers will be able to buy the same amount of goods, but spending much larger sums of money on them.

"In short, the mass distribution of money does not make people richer, but only accelerates inflation," the Central Bank of Russia stated.

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Earlier, on December 23, in the information and analytical commentary "Dynamics of consumer prices" the Central Bank of Russia pointed out that the tightness of monetary policy creates conditions for slowing inflation, despite rising prices. As predicted by the regulator, the monetary policy it pursues will reduce annual inflation to 4.0% in 2026 and "will be on target thereafter."

On the same day, during a meeting on economic issues, Russian President Vladimir Putin called balanced economic growth and moderate inflation systemic tasks for Russia. In addition, he attributed lending to the real sector, industry, agriculture and services to the important factors of confident economic dynamics. Prior to that, on December 20, the Central Bank said that annual inflation would drop to 4% in 2026.