It was still up to 73 rubles for a dollar on Wednesday morning. The Russian currency has reached the symbolic threshold of 80 rubles per dollar and 100 rubles per euro on Tuesday.
SALE OF FOREIGN CURRENCY
The amount of Kremlin intervention have not yet been released. But previous redemptions totaled more than $ 10 billion since the beginning of the month.
In practice, this is causing tension in the foreign exchange market, unbalancing the relationship between supply and demand for ruble .
But the success of this intervention is not guaranteed. Thus, the announcement Monday of a radical increase in the rate of the Russian central bank, and on Tuesday the sale of $ 1.96 billion in the foreign exchange market has not stopped falling ruble 9.5 % Monday and 7% Tuesday, the highest since the financial crisis of 1998.
FLIGHT OF CAPITAL
The ruble has lost about half its value at the beginning of the year, a result of capital flight caused by the Ukrainian crisis and plummeting oil prices, with the gas representing more than half of the country’s fiscal revenue.
This meltdown threatens to cause further price hikes as inflation is already close to 10% year on year and worries the population.
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