The ongoing Ukraine-Russia war has been hurting the economies of Ukraine and various nations across the globe. And Russia itself is no exception.
From stock market bloodbath to currency slumping, Russia¡¯s economy has been facing multiple issues, especially amidst the tightening sanctions against it across the globe from various countries and organizations.
In its latest effort to halt the slump in currency value, the Central Bank of Russia has more than doubled its interest rate.?
The interest rate has been increased from 9.5% to 20%, after the ruble (Russia¡¯s currency) sank 30% post new western sanctions against Russia. The currency then eased back to about 20% down, as per a report in BBC.
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Wondering how currency slump damages the economy? It¡¯s the collapse in currency value that erodes the currency's buying power and can even wipe out the savings of ordinary Russians.
Amidst the rising sanctions against it and weekend pictures of queues at cash machines, Russia had reportedly said that it had the resources to ride out sanctions.
Yesterday, President Vladimir Putin responded to the sanctions with an order barring citizens from transferring money outside of Russia, including even for debt payments.
Whereas Moscow's stock market, which bled red last week upon declaration of war, is said to remain closed for a second straight day on Tuesday, i.e. today, as per a BBC report.
In recent sanctions against Russia, the UK, along with the US and EU, have cut off major Russian banks from financial markets in the West, prohibiting dealings with the central bank, state-owned investment funds and the finance ministry. These moves have sent the ruble tumbling.
As per BBC, last week, Russia's central bank was forced to raise the amount of money it supplies to ATMs after the demand for cash reached the highest level since March 2020.
Yesterday, the central bank of Russia said it had ordered brokers to suspend the execution of all orders by foreign legal entities and individuals to sell Russian investments.
Overall, amidst the continuing announcements of various nations standing against Russia and imposing a long list of sanctions against it amid war, it's fair to say that the road doesn¡¯t seem to get any easier for Russia¡¯s government.?
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