EVERYTHING IS GOING SWIMMINGLY (MOSCOW EDITION): Russia to raise defence budget by 25% to highest level on record.

The latest planned increase in spending will take Russia’s defence budget to a record 13.5tn rubles (£109bn) in 2025, according to draft budget documents published on Monday on the parliament’s website. That is about 3tn rubles more than was set aside for defence this year, which was the previous record.

Taken together, spending on defence and security will account for about 40% of Russia’s total government spending – or 41.5tn rubles in 2025.

The 2025 budget suggests Putin has embraced what economists have dubbed “military Keynesianism”, marked by a significant rise in military spending, which has fuelled the war in Ukraine, spurred a consumer spending boom and driven up inflation.

Related: Russia’s Central Bank Raises Rates to 19% as Inflation Ticks Up. “Given that so much of the spending is being directed by the state, which is less responsive to higher borrowing costs, analysts fear interest rate rises may not be an effective tool against inflation.”