The effect that was supposed to provide the Russian currency’s sharp rise in rates (from 10.5% to 17%), announced on the night of Monday to Tuesday, the Russian Central Bank will therefore that was very short.
This persistent slump ruble revives the memory of 1998 at the Russians, when the collapse of the ruble in a few days, had led to a failure of Russia on its debt .
It also comes days before surgery (Thursday) before hundreds of Russian and foreign journalists, Russian President Vladimir Putin. Ever since coming to power in 2000, it was faced with such a situation. This voice is so highly anticipated. Especially since the last on the subject, December 4, during which he had put into question the responsibility of the West, nothing had changed.
What the Russian situation, some observers begin to call “pre-bankruptcy”.
- 1 / What is the magnitude of the fall of the ruble and why is it still down?
The Russian currency has lost nearly 10% of its value in a single day Monday. Such a decline had not been recorded since 1998. Since the beginning of the year, the ruble has depreciated by some 40% against the dollar and the euro.
Read also: Russia: the nightmare of the 1998 crisis
The fall of the Russian currency is due both to the decline in the price of oil, a raw material which the Russian economy is very dependent, but also to Western sanctions against Russia because of its role in the Ukrainian crisis.
But on Monday, analysts in the markets also evoked a movement of “panic fueled by a number of rumors about a return of [the] country in the 1998 Plan “, as indicated Alena Afanassieva, Forex Club analyst in Moscow, quoted by Reuters.
- 2 / What are the effects of the fall of the Russian currency?
The collapse of the currency is reflected in the evolution of prices. Inflation approach 10% year on year and is expected to reach a peak of 11.5% year on year in the first quarter 2015.
These days, labels appeared written in foreign currency in some stores This was common in the 1990s This price waltz causes a shopping fever, some Russians are pressing to buy electronics, furniture or even cars before seeing their prices flambé.
Russia also faces a starting capital: $ 128 billion (103 billion euros) have “flown” in 2014, according to the Central Bank of Russia (CBR)
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3 / What is the impact of the fall of oil prices?
In November, the Finance Minister Anton Siluanov had estimated that Russia could lose up 100 billion due to lower oil prices. However, it has since been increased.
The Russian Central Bank warned on Monday that if oil prices remain at current levels around $ 60 a barrel, Gross Domestic Product (GDP) of Russia could drop from 4.5% to 4.8%
Read also . Oil the lowest in five years
At this point, the Russian government expects a recession in 2015 (- 0.8%), following growth of about 0.6% this year. VTB Capital analysts said, meanwhile, that the decline in oil prices could lead to a budget deficit of 2% to 2.5% of GDP.
- 4 / How Russian authorities Respond
The Bank of Russia had endorsed this doctrine: only intervene in cases of emergency. Criticized for his action too slow and cautious, she is now virtually stress every day.
Since the beginning of the month she spent to support the ruble, $ 5.9 billion.
It also raised its rate to 10.5% Thursday, Dec. 11, nearly double its level at the beginning of the year (5.5%). Before passing the 17%, Monday, December 15
Read also . Russia falls drastically interest rates to limit the collapse of the ruble
According to press reports, the Russian government is also preparing to cut back on spending to match the decline in oil prices.
The Central Bank is seeking two things with its rate hikes. She first wants to raise the investment performance and ruble deposits so that it is above inflation. This is to prevent further transfers of the ruble to other currencies.
The BCR also intends to tighten credit to tap that prices revved no more. With an effect. This tightening of credit for households and businesses could weigh on an already bad Russian economy point
- 5 / What other policy options
The options selected at this stage have not had the desired effect, analysts expect that the Russian monetary policy takes “ a less orthodox orientation. ” The establishment of a control of capital movements is particularly mentioned.
At this point, the Russian government refused to do so, with the risk of undermining the credibility of Moscow markets. President Vladimir Putin has just proposed, there is a week a “complete amnesty” for those who decide to repatriate capital soared.
Read also: Fall of the ruble: Putin calls for measures against “speculators”
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