The ruble has stopped its downward movement for the time being. After the Russian national currency lost massive value in recent days and was at its lowest level since the invasion of Ukraine in February 2022, the central bank in Moscow had to intervene.
As an emergency measure, it was decided to stop buying foreign currencies on the domestic market until the end of the year. This supported the ruble, which was devalued by more than seven percent on Wednesday alone. “The reason for the trend reversal is the central bank’s decision to no longer buy foreign currencies as part of its fiscal policy,” said analysts at brokerage firm BCS. But you now expect prices to fluctuate significantly.
Immediately after the intervention, the ruble rose by 2.6 percent against the US dollar to 110.20. The ruble also rose slightly against the Chinese yuan to 14.60, according to the Moscow Stock Exchange (MOEX).
Huge difficulties in payment transactions
The sharp decline in recent days came as a surprise to economists. They had expected in a Reuters poll at the beginning of November that the Russian currency would defend the 100 mark against the dollar. But new US sanctions caused panic buying in the currency markets. Most major Russian banks – including now Gazprombank – are now hit by US sanctions and are therefore unable to conduct banking transactions in dollars. There is a deadline for settlement of transactions with Gazprombank until December 20. Until then, the remaining Russian energy customers in the West will have to find another payment solution.
Many of the sanctioned banks buy U.S. dollars and euros abroad and import the cash by air from countries that have not imposed trade restrictions with Russia.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
