Russian President Vladimir Putin has suggested that annual inflation in Russia may reach 8% this year, a day before the central bank is likely to raise interest rates to curb rising costs.

Labor shortages, credit growth, rising government spending, and a weak rouble create inflationary pressure.

Most analysts predict the Bank of Russia to raise its reference rate by 100 basis points to 16% on Dec. 15.

Putin has repeatedly praised Russia’s economy’s resilience against Western sanctions, but avoids discussing the currency’s weakness, high inflation, and the impact of high interest rates on households’ purchasing power.