Jan 21

Bank Of Russia Calls “Emergency” Meeting To Address Ruble Rout:

Earlier today, we highlighted a dramatic plunge in the Russian ruble which has crashed to record lows against the dollar after staging its steepest two-day decline in nine months.


The sharp (and seemingly inexorable) decline in crude prices combined with Western economic sanctions and geopolitical turmoil have weighed on the currency of late and in the midst of a new leg down in oil, investors appear to be panic selling.

Some investors are selling at any price,” Bernd Berg, an emerging-markets strategist in London at Societe Generale told Bloomberg by e-mail.

And even as Russian central bank Deputy Chairman Vasily Pozdyshev swears “there’s no systemic risk,” the Bank of Russia has now called an emergency meeting with state-run and private lenders to discuss the FX bloodbath. Continue reading »

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Jan 21

Russian Ruble Crashes To Record Lows In “Panic”: “Some Investors Are Selling At Any Price”:

Late last month, we took a look at Russia’s economy and concluded that although the country has proven to be remarkably resilient in the face of collapsing crude prices, the outlook is darkening.

The ruble has fallen for three consecutive years and is now under immense pressure both from Western economic sanctions and from crude’s inexorable decline. “The wish to hedge potential risks from geopolitics and commodities may well push the ruble to 75,” Evgeny Koshelev, an analyst at Rosbank PJSC in Moscow, told Bloomberg by e-mail in December. “It will be interesting to see if there’s a reaction from the central bank, government and households to this weakening.” Continue reading »

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Apr 15

Russian Ruble Extends Outperformance – Surges To Strongest Since November (ZeroHedge, April 15, 2015):

Isolated Russia continues to see its currency dramatically outperform the US Dollar. Breaking below 50 today, this is the strongest the Ruble has been since Nov 2014… The Ruble is now up almost 22% against the US Dollar year-to-date.

Strongest since November…


and best performing currency of the year…


Charts: Bloomberg

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Mar 18


Moscow Launches Ruble-Renminbi Futures To “Facilitate Trade Between China And Russia” (ZeroHedge, March 17, 2015):

While the west huffs and puffs, and threatens to unleash even more “costs” on Russia in the form of additional sanctions which will assure that Europe’s latest deflationary recession is even more acute, an “isolated” Russia is looking to outside, and to the east, and as part of its most recent de-dollarization initiative, the Moscow Exchange announced it has started trading Chinese Renminbi-Russian Ruble currency futures.

From the press release:

From 17 March the Moscow Exchange has started trading in a futures contract on the currency pair Chinese Renminbi — Russian rouble Continue reading »

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Mar 14

Russia Cuts Interest Rate From 15% To 14%, Ruble Rises (ZeroHedge, March 12, 2015):

Following the dramatic December surge in Russian interest rates when the Bank of Russia scrambled to preserve confidence in the then-plummeting currency and sent the interest rate to a whopping 17%, now that the oil price crash has stabilized it has been walking down this dramatic move, and after reducing rates by 2% on January 30 to 15%, moments ago the Bank of Russia once again cut rates this time by the expected 100 bps to 14%. The bank also said that more rate cuts are in the pipeline. Continue reading »

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Dec 18

From the article:

“It won’t be long before this chart is replicated in a whole lot of other places. But by then it will be too late to prepare. The gold will be gone …”


This Is What Gold Does In a Currency Crisis (Dollar Collapse, Dec 16, 2014):

To say that gold is in a bear market is to misunderstand both gold and markets. Gold isn’t an investment that goes up and down. It is money in the most basic store-of-value sense. Most of the time it just sits there, and when its price changes in local currency terms that says more about the local currency than about gold.

But when currencies collapse, gold shines.

Consider the above from the point of view of a typical Russian. The ruble is tanking (no need to understand why — all fiat currencies go this way eventually and the proximate cause is almost irrelevant). Russians who trusted their government and kept their savings in, say, a bank account, are losing their shirts. But those who own boring, doesn’t-pay-interest, in-a-bear-market gold have seen their capital appreciate in local currency terms by about 60 percent in just the past month. They’re not “making money,” but they are preserving wealth. Continue reading »

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Dec 18

Putin: Russian economy will inevitably bounce back, 2 years in worst case scenario (RT, Dec 18, 2014):

The Russian economy is to start growing again in 2 years in the worst case scenario, President Vladimir Putin said at his annual press conference. Russia, which is facing recession, is ready to fight the impending crisis, as it did in 2008, he said.


“The economy will grow. And our economy will get out of the current situation,”Putin said, adding that he expected the economy to grow by 0.6 percent in 2014. He said the government will handle the crisis similarly to 2008.

In 2008, Russia along with the much of the rest of the world fell into recession, losing 7.8 percent of GDP in 2009. The Russian economy fared the crisis rather well, and the economy was back on track with 4.5 percent growth in 2010.

Russia’s 2014 budget will have a 1.9 percent surplus relative to GDP, despite the turbulent economic situation, the Russian president said. Continue reading »

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Dec 18

Fly in Venus flytrap

IMF Now Ready To Slam The Door On The U.S. And The Dollar (ALT-MARKET, Dec 17, 2014):

As I write this, the news is saturated with stories of a hostage situation possibly involving Islamic militants in Sydney, Australia. Like many, I am concerned about the shockwave such an event will create through our sociopolitical structures. However, while most of the world will be distracted by the outcome of this crisis (for good or bad) for at least the week, I find I must concern myself with a far more important and dangerous situation.

Up to 40 people may be held by a supposed extremist in Sydney,but the entire world is currently being held hostage economically by international banks. This is the crisis no one in the mainstream is talking about, so alternative analysts must.

As I predicted last month in “We Have Just Witnessed The Last Gasp Of The Global Economy,” severe volatility is now returning to global markets after the pre-game 10 percent drop in equities in October hinted at what was to come. Continue reading »

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Dec 17

russia store_0

Russian Food Suppliers Have Begun Halting Shipments (ZeroHedge, Dec 17, 2014):

Until now, when it comes to the fallout in the Russian economy from the crude price plunge leading to a collapse in the Russian currency, most of the interest has been on how the Russian financial system recovers and/or survives and just as importantly, what Putin’s response would be. Just yesterday, we wrote that as a result of capital controls fears, many western banks led by Goldman Sachs had halted liquidity to Russian clients and other local entities.

However while the adverse impact on the Russian banking system has been mostly confined to the upper class – since there is virtually no middle class in the country to speak of – the second cold war of words, which rapidly morphed into a very hot financial war, is about to hit the very ordinary Russian on the street, because as Russia’s Vedomosti reports, citing vegetable producer Belaya Dacha, juice maker Sady Pridoniya and others, Russian suppliers are suspending food shipments to stores because of unpredictable FX movements. And it is about to get worse: very soon Russians may have to live without imported alcohol because at least on supplier of offshore booze, Simple, halted shipments in “a two-day pause” to see what happens with the ruble, Vedomosti reports.

The full story from Vedomosti: Continue reading »

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Dec 17

– Russian Stocks Soar 17% – Most Since 2008; Ruble Back Below 62/USD (ZeroHedge, Dec 17, 2014):

After falling for 15 of the last 16 days, the RTS (Russian Stocks) are surging 17% today, extending gains post CBR 7 Measures, the most since October 2008.The Ruble is soaring also – back below 62/USD.

RTS biggest gain since Oct 2008…


Juiced by the CBR Measures…


Charts: bloomberg

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Dec 17


Russian Central Bank Releases 7 Measures It Will Take To Stabilize The Financial Sector (ZeroHedge, Dec 17, 2014):

In its latest effort to counter financial instability – and show its commitment to maintaining order and support for the economy – Russia’s Central Bank (CBR) has unveiled 7 new measures… Ranging from bank recaps to measures aimed at helping manage interest-rate and credit risks, the reaction in the Ruble is positive for now… as perhaps, taking a lesson from the US, The CBR removes Mark-to-Market accounting for various credit instruments. Continue reading »

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Dec 17


A Full-Blown Economic Crisis Has Erupted In Russia (Economic Collapse, Dec 16, 2014):

The 8th largest economy on the entire planet is in a state of turmoil right now.  The shocking collapse of the price of oil has hit a lot of countries really hard, but very few nations are as dependent on energy production as Russia is.  Sales of oil and natural gas account for approximately two-thirds of all Russian exports and approximately 50 percent of all government revenue. So it should be no surprise that the fact that the price of oil has declined by almost 50 percent since June is absolutely catastrophic for the Russian economy.  And when you throw in international sanctions, wild money printing by the Central Bank of Russia and unprecedented capital flight, you get the ingredients for an almost perfect storm.  But those of us living in the western world should not be too smug about what is happening in Russia, because the nightmare that is unfolding over there is just a preview of the economic chaos that will soon envelop the whole world.

So far this year, the Russian ruble has fallen nearly 50 percent against the U.S. dollar.  That is a monumental shift.  And as the collapse of the ruble has accelerated in recent days, we are seeing scenes in Russia that are reminiscent of the Weimar Republic.  For example, just consider the following excerpt from an article that just appeared in the New York TimesContinue reading »

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Dec 17

RUB back teaser

“Ruble Trading To Resume” (ZeroHedge, Dec 17, 2014):

As already noted, yesterday one after another FX broker scrambled to disconnected the Russian currency from the system due to “western banks stopping quoting pricing” and as a result of epic volatility (and as everyone knows, brokers prefer to only trade those pairs where they know with near certainty they can pick 1 pip or so from every trade which is why they prefer stability and orderly markets). However, in the aftermath of today’s announcement that the Russia finance ministry will join the central bank in selling reserves, the RUB has found a bid. And sure enough, here come the FX brokers barging back, advising that Ruble trading is set to resume this afternoon. Continue reading »

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Dec 17


Surprise! Guess which currency has stronger fundamentals— the dollar or… ruble? (Sovereign Man, Dec 16, 2014):

Last night, the Russian central bank announced a shock decision to hike up its key interest rate from 10.5% to 17%, effective immediately. Incredible.

On Monday alone the ruble declined more than 9% against the dollar, and almost 50% in 2014. It looks like a massacre.

If you listen to conventional financial news, they’ll all tell you that you’d have to be insane to own anything in Russia right now—stocks, bonds, currency, etc.

They’ll tell you that the ruble is in freefall, and that the dollar is the place to be.

But if you have been a reader of this column for any length of time, you know that I am a very data-driven person.

So… just for kicks, I decided to dive into the numbers and make an objective comparison between the US dollar and the Russian ruble.

The results might surprise you.

Continue reading »

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Dec 16

Western Banks Cut Off Liquidity To Russian Entities (ZeroHedge, Dec 16, 2014):

As Zero Hedge first reported today, shortly before noon one (and subsequently more) FX brokers advised clients that any existing Ruble positions would be forcibly closed out because “western banks have stopped pricing USDRUB“, over concerns of Russian capital controls. Ironically, it was this forced liquidation of mostly short RUB positions that pushed the RUB higher, which in turn had a briefly favorably impact on energy commodities and risk assets, as the market had by then perceived the Ruble selloff as excessive. Of course, since nothing had actually changed aside from a temporary market technical, the selloff promptly resumed into the close of trading once the market finally understood what we had explained hours previously.

And unfortunately for the bulls, various falling knife-catchers, and those who hope the Russian situation will stabilize imminently with or without capital controls, it appears things in Russia are about to get a whole lot worse because as the WSJ reports, the next driver of the Russian crisis is likely to come from within the banking system itself because global banks are curtailing the flow of cash to Russian entities, a response to the ruble’s sharpest selloff since the 1998 financial crisis.”

Presenting Russia’s banks: now cut off from the outside world as the second cold war goes nuclear, at least when it comes to the financial system:
Continue reading »

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Dec 16

The Russian Ruble Is Hereby Halted Until Further Notice (ZeroHedge, Dec 16, 2014):

Earlier, we reported that various currency brokers such as FXCM and FxPro, would – as a result of the soaring liquidity in the USDRUB pair – suspend trading in the Russian Ruble (while other merely hiked margins to ridiculous levels). It appears things have escalated again, and as FXCM just reported, instead of just politely advising clients not to open new USDRUB position tomorrow, it has advised anyone long, or short, the USDRUB that their positions will be forcibly shut in moments.


So for those curious why there appears to be a collapse in Ruble volatility in the past few hours which in turn has sent both stocks and crude soaring, the answer is simple: nobody is trading it!

And this is what happened following the post: as soon as all those short the RUB (long USDRUB) realized they have to take profits, the USDRUB tumbled some 500 pips (!) in the process sending stocks surging.

usrub halted

h/t @Paul_Courtney


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Dec 16

“The USDRUB Pair Will Be Discontinued Due To Recent Instability Of The Russian Ruble” (ZeroHedge, Dec 16, 2014):

Dear Russian Ruble traders, please find a different sandbox, because “evil speculators” will no longer be tolerated, first at Forex Capital Markets and soon, everywhere else.

Ruble trading discontinued

And now, unless the selloff in US equity futures is immediately halted, expect the first self-help headline in US markets to strike – as usual – within hours.

* * *

Update: And now FxPro:

Continue reading »

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Dec 16

Ruble plummets losing more than 20% in a day, hitting new dollar and euro lows (RT, Dec 16, 2014):

No end seems to be in sight for the plight of the Russian ruble, which slumped to new record lows against hard currencies Tuesday. The EUR traded at 93.5 against the ruble, and the USD at 75.

The Russian stock market also went haywire, dropping more than 15 percent as of 2:30pm Moscow time, after it dropped 11 percent the day before. Sberbank, the country’s largest lender, lost 17.77 percent, and VTB, the second biggest bank, fell by 14.29 percent. State-owned oil and gas companies Gazprom, Rosneft, and Surgut also saw shares plummet.

The emergency interest rate hike to 17 percent has failed to halt the ruble’s landslide tumble against hard currencies. The rate increase only calmed the ruble temporarily. Continue reading »

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Dec 15


Russia Shocks With Emergency Rate Hike, Boosts Interest Rate From 10.5% To 17% (ZeroHedge, Dec 15, 2014):

Following the biggest rout to the Ruble in ages, Russia – unlike Mario Draghi – instead of talking the talk decided to walk the bazooka walk and shocked all those long the USDRUB by unleashing an emergency rate hike (at 1 am in the morning) from the recently raised interest rate of 10.50% to… hold on to your hats… 17.00%, a 650 bps increase!

From the press release:

The Board of Directors of the Bank of Russia has decided to increase from December 16, 2014 the key rate to 17.00% per annum. This decision was driven by the need to limit significantly increased in recent devaluation and inflation risks. Continue reading »

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Oct 09

Russia Central Banks Scrambles To Halt Plunging Ruble, Spends Over $2 Billion In Last Three Days As Inflation Soars (ZeroHedge, Oct, 8, 2014):

Recently, not a day passes without the Russian Ruble hitting new record lows against the US Dollar due to a combination of both capital outflows from Russia, tumbling prices of crude – Moscow’s most important export – which deteriorates Russia trade and current account position, coupled with the most acute USD strengthening in history in the past few months over fears of a tightening Fed.

Yet for whatever the reason, after stoically ignoring the impact of its tumbling currency on the domestic economy (and as a reminder, Japan would kill for a currency collapse of this magnitude: just think of the “economic renaissance” that would result if only Abenomics was right about killing your currency leading to growth… which it isn’t), the Kremlin is finally starting to feel the pinch leading to the biggest central bank intervention in FX markets since the start of the Ukraine campaign, buying Rubles for a third consecutive day at an amount of over $2 billion, with $1.75 billion purchased in the first two days of the current intervention attempt, and another $420 million in foreign currencies sold overnight according to Bank of Russia data. Continue reading »

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Aug 28


The Nail In The Petrodollar Coffin: Gazprom Begins Accepting Payment For Oil In Ruble, Yuan (ZeroHedge, Aug 27, 2014):

Several months ago, when Russia announced the much anticipated “Holy Grail” energy deal with China, some were disappointed that despite this symbolic agreement meant to break the petrodollar’s stranglehold on the rest of the world, neither Russia nor China announced payment terms to be in anything but dollars. In doing so they admitted that while both nations are eager to move away from a US Dollar reserve currency, neither is yet able to provide an alternative.

This changed in late June when first Gazprom’s CFO announced the gas giant was ready to settle China contracts in Yuan or Rubles, and at the same time the People’s Bank of China announced that its Assistant Governor Jin Qi and Russian central bank Deputy Chairman Dmitry Skobelkin held a meeting in which they discussed cooperating on project and trade financing using local currencies. The meeting discussed cooperation in bank card, insurance and financial supervision sectors.

And yet, while both sides declared their operational readiness and eagerness to bypass the dollar entirely, such plans remained purely in the arena of monetary foreplay and the long awaited first shot across the Petrodollar bow was absent.

Until now.

According to Russia’s RIA Novosti, citing business daily Kommersant, Gazprom Neft has agreed to export 80,000 tons of oil from Novoportovskoye field in the Arctic; it will accept payment in rubles, and will also deliver oil via the Eastern Siberia-Pacific Ocean pipeline (ESPO), accepting payment in Chinese yuan for the transfers. Meaning Russia will export energy to either Europe or China, and receive payment in either Rubles or Yuan, in effect making the two currencies equivalent as far as the Eurasian axis is conerned, but most importantly, transact completely away from the US dollar thus, finally putin'(sic) in action the move for a Petrodollar-free world. Continue reading »

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Jul 18

 – Russian Ruble Crashes Most In 3 Years (ZeroHedge, July 17, 2014):

The Ruble was already losing ground on the back of US Sanctions but those losses accelerated markedly after the Malaysia Airliness jet crash news. This is the biggest drop in the Ruble since August 2011…


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Mar 17

Russian Stocks, Ruble Respond To Obama’s Sanctions By Extending Gains (ZeroHedge, March 17, 2014):

Despite no move in gold, silver, or US Treasuries, US equities (and JPY crosses) remain bid. But perhaps the most intriguing reaction to Obama’s escalation is the surge higher in Russian stocks and rally in the Ruble… Putin and his oligarch friends must be pleased…


Charts: Bloomberg

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Feb 07

Chairman Sergei Ignatiev said last month the fastest inflation in a year may force Bank Rossii to raise the record-low refinancing rate before the end of March. Photographer: Dmitri Astakhov/AFP/Getty Images

Feb 07 (Bloomberg) — Russia, the only one of the so-called BRIC countries without capital controls, is following China and Turkey in relying on reserve requirements to drain cash from the economy and avoid luring more speculative investment.

“We stand ready to continue increasing mandatory requirements, if needed,” Bank Rossii Chairman Sergey Ignatiev said in Frankfurt on Feb. 4. Policy makers will “act decisively to meet the forecast” for 2011 annual inflation of between 6 percent and 7 percent, he said.

The central bank on Jan. 31 increased the mandatory reserve ratio while unexpectedly leaving its deposit rates unchanged after inflation in January accelerated to the fastest in 15 months. Policy makers cited the threat of rising capital inflows driven by higher oil prices.

Emerging economies are weighing the need to curb inflation against the risk of attracting speculative capital from near- zero interest rates in the U.S. and Europe. The threat of a stronger ruble and stifled exports may be a “big headache” for Russia, central banker Alexei Ulyukayev said last month.

The ruble is the third-best performer against the dollar this among more than 20 emerging-market currencies tracked by Bloomberg, having gained 3.9 percent.

Continue reading »

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Nov 24

See also:

China, Russia, Iran are Dumping the Dollar, Buy Gold And Silver

Russian Prime Minister Vladimir Putin shakes hands with his Chinese counterpart Wen Jiabao

SAINT PETERSBURG (AFP) — Prime Minister Vladimir Putin said on Tuesday the Chinese yuan would soon start trading in Russia as the countries seek to challenge the dollar and promote the use of national currencies.

“We agreed to expand the possibilities for application of national currencies during trade and economic contacts,” Putin said after talks with Chinese Premier Wen Jiabao in the former Imperial capital Saint Petersburg.

“Now the ruble started trading on the exchange in China and the yuan trade will begin in Moscow in early December,” Putin said, hailing the move as a “serious step” on the path to strengthening economic ties.

On Monday, China conducted the first yuan trade with the Russian ruble in order “to promote the bilateral trade between China and Russia” and to reduce the conversion cost among other tasks, said a statement posted on the website of the China Foreign Exchange Trade System.

Both China and Russia, which both seek to promote their national currencies worldwide, have called for a revamp of the global financial system in the wake of the global economic crisis, saying there is a need for a new supra-national currency besides the dollar.

Continue reading »

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Feb 06

Source: YouTube

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Feb 06

Source: YouTube

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Jan 19

U.S. President-elect Barack Obama waves after speaking during the “We Are One: The Obama Inaugural Celebration at the Lincoln Memorial” event in Washington on Jan. 18, 2009. Photographer: Andrew Harrer/Bloomberg News

Obama Issues Call to Service to Help Repair Nation (Bloomberg):
Obama is using the latest state of the art manipulating techniques. Don’t fall for this puppet of the elite, rather listen to some of the few people – like Ron Paul, Peter Schiff, Marc Faber and Jim Rogers – that are telling you the truth:
Paul Craig Roberts On The U.S. Leadership: “They Are Criminals” – The Potential Here Is Far Worse Than The Great Depression or Peter Schiff: We are the United States of Madoff

More change: Obama Reaches Out for McCain’s Counsel (New York Times)

California Finds Public-Works Spending No Unemployment Cure-All (Bloomberg):
“What infrastructure spending can do is bolster employment in a group of industries, like construction, with workers who are ready to go,” said Brad Kemp, director of regional research at Beacon Economics in Los Angeles. “What it can’t do is stop the unemployment rate from rising currently because there are a lot of forces coming at consumers, who are holding back on spending.” California is totally broke: Here

– ! Bonds tumble as Government admits no cap on taxpayer risk (Telegraph)

Brazil Cut Record 654946 Registered Jobs in December (Bloomberg)

Brussels sees Eurozone economy shrink 1.9% (Financial Times)

Taxpayers are spending over $1 billion to send refined fuel to the Israeli military — at a time when Israel doesn’t need it and America does (Salon)

Spain Downgraded by S&P as Slump Swells Budget Gap (Bloomberg):
Jan. 19 (Bloomberg) — Spain had its AAA sovereign credit rating removed by Standard & Poor’s in the second downgrade of a euro-region government in five days, as the country’s first recession in 15 years swelled the budget deficit.

China GDP Growth May Cool to Slowest Pace in 7 Years (Bloomberg)

Ruble Drops to Pre-1998 Crisis Low on 6th Devaluation This Year (Bloomberg):
Jan. 19 (Bloomberg) — The ruble fell below the weakest level seen in the 1998 Russian crisis after the central bank devalued for the sixth time in seven days to protect reserves.

Fifty jobseekers chasing every vacancy in some parts of the country (Telegraph)

Treasury Yields Flattened as Fed Fights to Cut Mortgage Rates (Bloomberg):
Fed Chairman Ben S. Bernanke helped spark a rally by reiterating Jan. 13 at the London School of Economics that he’s considering buying long-term Treasuries to reduce borrowing rates as the recession deepens.
(Bernanke helped to create the ultimate Bond Bubble: Here, here and here.)

Bonds no safer than houses (The Financial Standard)

Denmark agrees on 13.4-bln-euro line of credit to banks: govt (AFP)

How the Treasury Bubble Will Burst and Why (Seeking Alpha)

Investor puts pressure on HSBC to let US sub-prime unit go bankrupt (Times)

Tory chief’s firm cost councils £470m (Independent)

RBS on the brink as shares plummet by 69% and City is warned: ‘You’re about to become
(Mail Online)

RBS ready to write off £1bn loan to Russian oligarch (Scotsman)

RBS Plummets Amid Concern Bank May Be Nationalized (Bloomberg)

RBS shares dive 70% on mounting debt fears (Times Online)

Tax rise for rich won’t make society fair, says Mandelson (Guardian)

More Americans Joining Military as Jobs Dwindle (New York Times)

Circuit City to close remaining 567 stores in US (Los Angeles Times):
The failure of the No. 2 electronics retailer means the loss of 34,000 jobs.

BASF warns of possible job and production cuts (Houston Chronicle)

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Jan 15

A pedestrian walks underneath sign advertising exchange rates for the Ruble against the U.S. Dollar and Euro, outside a currency exchange centre in Moscow, Russia, on Monday, Jan. 12, 2009. Photographer: Alexander Zemlianichenko Jr/Bloomberg News

Jan. 15 (Bloomberg) — Russia’s ruble tumbled to a record low against the dollar after the central bank devalued the currency for the fourth time in five days and Vedomosti reported the government slashed its estimate for oil prices by 20 percent.

The currency dropped to as low as 32.4112 per dollar, the weakest since Russia redenominated the currency at the start of 1998, before the financial crisis. The ruble’s trading band versus the dollar-euro basket has been widened, a Bank Rossii official who can’t be identified on bank policy said. The ruble has slumped 27 percent against the dollar since August.

“The bottom line is that they need to get this over with and the faster the better,” said Rory MacFarquhar, Moscow economist for Goldman Sachs Group Inc., which forecasts a further 12 percent depreciation in the ruble versus the basket. “They’re still catching up with what happened in oil last year. They’re still getting it to a sustainable level.”

Russia cut its average oil forecast for this year to $40 a barrel, from a previous $50, Vedomosti cited government officials as saying today. That’s the below the $70 average the government says is needed to balance this year’s budget. Urals crude, the country’s main export oil blend, has slipped 64 percent to $43.47 since August, pushing the energy-fueled economy toward recession.

Continue reading »

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Dec 29

Dec. 29 (Bloomberg) — The ruble fell to a record low against the euro as Russia devalued the currency for the 12th time in seven weeks after the government forecast its first budget deficit in a decade.

The managed currency weakened 2.6 percent to 41.7245 per euro, the lowest since the European currency started trading in 1999. It fell 0.7 percent to 29.1797 versus the dollar, a four- year low. Bank Rossii allowed the ruble to fall 1.7 percent against its basket of 55 percent dollars and 45 percent euros, the most since the measure was introduced in February 2005, according to a central bank official who declined to be identified, citing bank policy.

Continue reading »

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