Earlier this afternoon, the Russian currency price at one point dropped to 100.25 rubles per USD. This is the lowest level in 7 weeks. Currently, this currency has increased in price again, to 99.58 RUB per USD.
The Ruble also increased 0.6% against the euro and was stable against the yuan. Currently one euro is equivalent to 104.2 rubles. One yuan can be exchanged for 13 rubles.
The last time the ruble crossed the 100 mark , the Central Bank of Russia had to urgently raise interest rates by 350 basis points (3.5%) to bring interest rates to 12%. Russian officials at that time also discussed re-imposing capital controls to support the local currency.
"The 100 mark is not a technical barrier. It is an important psychological barrier. Currently, all predictions are that the ruble will lose value," said Alexei Antonov - analyst at Alor Broker.
The Ruble has continuously weakened against the US dollar over the past year. Graph: Reuters
Ruble is often under pressure at the beginning of the month. Because the end of the month is the time when exporting firms convert revenue from foreign currency to domestic currency to pay taxes.
"Rising oil prices and high interest rates will improve the outlook for the ruble in the medium term," said analysts at Promsvyazbank. They predict that the ruble will continue to exceed 100 rubles per dollar if authorities do not have new support measures.
Last month, the Central Bank of Russia continued to raise interest rates to 13%. According to a Reuters survey, as inflationary pressures remain high, the agency will continue to tighten policy in the upcoming meeting on October 27.
The Ruble has fluctuated strongly since the Russia-Ukraine conflict broke out in February 2022. Last March, the ruble had a record low, with 120 rubles per US dollar. But just a few months later, the currency reached a 7-year peak against the ISD, thanks to capital control policies and soaring Russian export revenues.
This year, falling exports (partly due to Western sanctions and shifting global trade flows) and rising imports have weakened the ruble. The current account surplus in the first 8 months of the year also decreased by 86% compared to the same period last year, to 25.6 billion USD.
Ha Thu (according to Reuters)
