Russia’s central bank is expected to raise its key interest rate beyond its record of 21 per cent on Friday, as policymakers struggle to tame inflation in what Vladimir Putin described as an “overheating” war economy.

Elvira Nabiullina, the hawkish governor of Russia’s central bank, the CBR, is facing an increasingly loud chorus of criticism from officials and oligarchs who say her efforts to rein in inflation are stifling business. Her persistence in rising rates even as inflation is sliding out of the bank’s control highlights how policymakers have failed to balance irresolvable priorities during the war, according to senior Russian businessmen and economists.

“Either you have enormous spending, or a stable foreign exchange rate and a market economy,” a former senior energy executive said. “You have to sacrifice one of those. You can’t have it all at once.”