Thursday, September 21, 2023

The Russian currency breaks the psychological barrier of 100 rubles to the dollar

The Russian currency breaks the psychological barrier of the 100 rubles per dollar on the Moscow Stock Exchange despite the measures introduced by the Central Bank to stop its devaluation. The ruble reached 100.18 units per US dollar on the Moscow market this Monday, the lowest figure since the end of March 2022.

The lowest point of the Russian currency was reached on March 11 of 2022two weeks after the start of the war in Ukraine, when it fell to 120 rubles to the US dollar.

In addition, the ruble also continued to weaken against the euro, since on the stock market it was quoted at 109.81 rubles for each european currencyits lowest point since March 23 of last year.

The ruble has not stopped depreciating since the head of the wagner groupYevgueni Prigozhin, will lead a failed armed rebellion on June 23-24.

However, the deputy chairman of the Central Bank of Russia (BCR), Alexei Zabotkinassured this Friday that the issuing entity sees no risk to financial stability, although it did not rule out a rise in interest rates due to the increase in inflation.

The ruble, which already fell 7.7% in July compared to the previous month, it has devalued 26.4% during the first seven months of this year.

The downward trend of the ruble was not reversed by the decision this week of the BCR to suspend from August 10 the purchase of foreign currency in the domestic market to “reduce the volatility of financial markets.”

The BCR has indicated that the main factor in the fall of the ruble remains the imbalance in the trade balance, highlighting that the value of exports has been reduced by a third since the second half of 2022.

Precisely, in December 2022 is when the western powers They imposed a cap of $60 on the price of Russian oil, the country’s main source of foreign currency.

The western sanctions Revenues from the export of hydrocarbons have notably reduced -gas costs ten times less than last year-, while imports are close to the levels prior to the start of the war.


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