Russia's Public Debt Reaches Historic High of 7.2 Trillion Rubles

The volume of public debt placements on the domestic market reached a historic maximum of 7.2 trillion rubles in 2025. This represents a significant 1.7-fold increase compared to the previous year, marking a substantial expansion in government borrowing.

The primary driver of this growth was the increased issuance of bonds with fixed coupons. Demand for these securities surged following the initiation of a cycle to lower the key interest rate. Looking ahead to the next year, market participants anticipate that these fixed coupon instruments will continue to dominate the offerings from the Ministry of Finance, although the possibility of issuing floating rate bonds remains to replace maturing issues.

The domestic market for government bonds experienced an unprecedented surge in 2025, with placement volumes reaching 7.2 trillion rubles. This figure establishes a new historical maximum for public state borrowing within the Russian market.

Compared to the data from the previous year, the volume of these borrowings has grown by a factor of 1.7. This substantial increase highlights a significant shift in fiscal strategy and market conditions over the past twelve months.

The surge in borrowing volume was largely fueled by specific types of debt instruments. Bonds with fixed coupons were the primary engine of this growth, attracting substantial investor interest.

This heightened demand is directly linked to the macroeconomic environment, specifically the commencement of a cycle of reductions in the key interest rate. As the central bank began lowering rates, the attractiveness of fixed-income assets increased for investors seeking stable returns.

Market analysts and participants are already looking toward the Ministry of Finance's strategy for the upcoming year. The consensus expectation is that fixed coupon bonds will maintain their dominance in the state's borrowing proposals.

However, the market is not ruling out the issuance of floating rate notes (floaters). These could be utilized specifically to replace two existing bond issues that are scheduled to mature in the near future, ensuring a smooth rollover of the debt portfolio.

In summary, 2025 was a landmark year for public debt in the domestic market, culminating in a record volume of 7.2 trillion rubles. The shift towards fixed coupon bonds, spurred by a changing interest rate environment, defined the borrowing landscape. As the cycle continues, the composition of future debt instruments will likely reflect ongoing monetary policy adjustments, with fixed coupons remaining the preferred vehicle for both the issuer and the investor.