Putin held a televised meeting with top economic officials where he publicly acknowledged that Russia's economy contracted by 1.8% in January and February—the first contraction since 2022—and expressed frustration that economic performance was below government forecasts. The contraction reflects the war's toll: a tight labor market (2% unemployment, historically low) has driven inflation and high interest rates, squeezing companies and consumers, while Ukraine's drone attacks on Russian oil export hubs have prevented Moscow from fully capitalizing on higher oil prices following the Iran conflict. Russia's central bank and government officials have warned of potential banking and debt crises if the economic squeeze continues, setting up a critical test point by summer as the war's military demands collide with fiscal constraints.