Russia's finances: Sovereign wealth fund melts to $198 billion

The assets of the Russian sovereign wealth fund have decreased.

It totaled $198.3 billion on Aug. 1, or 9.1 percent of this year's expected gross domestic product.

This was announced by the Ministry of Finance on Monday in Moscow.

On July 1, it was $210.6 billion.

The sovereign wealth fund is fed primarily from income from oil and gas exports.

Although it is actually intended to finance large infrastructure projects, the government intends to tap it this year to cover the budget deficit.

The Russian economy is under pressure from Western sanctions over the invasion of Ukraine.

According to the International Monetary Fund (IMF), it will fall by 6 percent this year - less than the minus 8.5 percent forecast in April.

Economists surveyed by Reuters also expect high inflation: the average rate of inflation is likely to be 13.4 percent this year, after 8.4 percent in 2021.