Russian ruble slumps to near 17-month low, briefly moves past 100 against dollar

The Russian ruble concisely notched 100 to the U.S. dollar connected Monday, nearing a 17-month debased as President Vladimir Putin's economic advisor blamed loose monetary argumentation for the accelerated depreciation.

The ruble has mislaid astir 30% against the greenback since the crook of the year. The Bank of Russia has blamed the country's shrinking equilibrium of trade, arsenic Russia's existent relationship surplus fell 85% twelvemonth connected twelvemonth from January to July.

By mid-afternoon successful London, the ruble was trading conscionable supra 101 to the dollar. Russia's cardinal slope aboriginal announced it volition clasp an bonzer complaint gathering connected Tuesday. In a statement, it said the gathering volition beryllium held "to see the contented of the cardinal complaint level" and it would denote the board's determination astatine 10:30 a.m. Moscow time.

Putin's economical advisor, Maxim Oreshkin, told Russia's state-owned Tass quality bureau that the depreciation of the currency and acceleration of ostentation was chiefly owed to "loose monetary policy" and that the cardinal slope has "all the indispensable tools to normalize the concern successful the adjacent future."

"A anemic ruble complicates the restructuring of the system and negatively affects the existent incomes of the population. In the interests of the Russian system — a beardown ruble," he said, according to a Google translation.

The cardinal slope connected Thursday halted overseas currency purchases for the remainder of the twelvemonth successful a bid to enactment up the currency, which is fueling fears of rising ostentation arsenic Russia attempts to fundamentally alteration its system successful the look of expanding isolation and punitive Western sanctions.

Russian GDP exceeded expectations to turn by 4.9% twelvemonth connected twelvemonth successful the 2nd quarter, caller figures from the Federal State Statistics Service showed Friday, rebounding from a 1.8% contraction successful the archetypal quarter.

But William Jackson, main emerging markets economist astatine Capital Economics, noted that constricted slack successful the system is apt to further substance ostentation pressures and effect successful monetary argumentation tightening, perchance weakening maturation implicit the remainder of the twelvemonth and into 2024.

"Perhaps the cardinal hazard to the system is if the authorities keeps fiscal argumentation escaped to enactment the warfare effort, which would origin Russia's economical vulnerabilities to worsen further," Jackson added.