Russia's Ruble, Financial Markets Are Hammered by Sanctions
Source: The Wall Street Journal.
MARKETS
Russias Ruble, Financial Markets Are Hammered by Sanctions
Central bank doubles interest rates to protect the banking system as the ruble plunges
By Caitlin Ostroff
https://twitter.com/ceostroff
caitlin.ostroff@wsj.com
Updated Feb. 28, 2022 6:20 am ET
Powerful Western sanctions rocked Russias financial system and triggered a spiral in the ruble, drawing the central bank into an emergency doubling of interest rates.
The Russian ruble fell as low as 111 to the U.S. dollar from 83 on Friday, a drop of more than 20% and, if sustained, the biggest single-day fall on record. But trading was spotty, with local onshore markets frozen by the central bank and markets outside Russia reluctant to trade the currency.
The Bank of Russia took a raft of measures early Monday to protect Russias banking system. It raised benchmark rates to 20% from 9.5% in an attempt to attract savings into banks, the largest of which were targeted by Western sanctions and will be all but cut off from international markets.
The bank delayed trading on domestic debt and currency markets, making it difficult to assess where the ruble would end up. The central bank blocked the opening of the stock market. It also ordered Russian companies, some of which generate sales for energy products in dollars, to sell 80% of their foreign-currency revenue. The move will create demand for rubles and prevent companies from hoarding dollars.
Investors increasingly priced the chance that Russia wont be able to, or wont be willing to pay off its foreign debts. The yield on a Russian dollar bond maturing in June 2027 jumped to more than 24% Monday from just under 10% Friday, according to Tradeweb.
{snip}
Paul Hannon and Greg Ip contributed to this article.
Write to Caitlin Ostroff at caitlin.ostroff@wsj.com
Read more: https://www.wsj.com/articles/russias-ruble-financial-markets-are-hammered-by-sanctions-11646038133
The article starts off talking about something that happened on Friday, so I thought at first it was not LBN.
The article goes on the point out that "{t}he Bank of Russia took a raft of measures early Monday to protect Russias banking system. It raised benchmark rates to 20% from 9.5% in an attempt to attract savings into banks ..."
Roy Rolling
(6,943 posts)The Russian economy is toast, Putin is a poor man except for his toys.
All of his oligarch friends are bankrupt overnight, and 90% of the Russian people are facing crippling inflation and loss of buying power and want his head.
But tell me again how Biden is caught off-guard. 👏👏
Phoenix61
(17,027 posts)I believe Id call the note due, now, in full just because I could.
FakeNoose
(32,912 posts)... well I could be wrong. But Chump taught them how to set up anonymous businesses in Delaware with generic names like "ABC Holding Company." When they bought properties from Chump they wired bank checks, with no mortgages or loans. At least that's what Michael Cohen told us when he testified. Not sure how it went in other countries though.
blue-wave
(4,375 posts)#1 Invading Ukraine
#2 Threatening the world with nuclear weapons
Together they made a lethal combination that brought the world together against him.
Lonestarblue
(10,164 posts)He needs to be carted off to an institution and placed in a room with windows on the 5th floor. No one can be blamed when he leaps out the window.
rpannier
(24,350 posts)Only, unlike a duel where I hold his coat and watch the two men shooting, I get to be the guy that pushes him
rpannier
(24,350 posts)He can tell us why Putin's invasion was such a great idea
Obvious85
(259 posts)He thought he would attack a peaceful country and it would be 'businesses as usual' with the rest of the world. He is finding his power is not his own, but it requires the cooperation of the entire world with Russia, but now the World has now stopped cooperating
mahatmakanejeeves
(57,749 posts)Link to tweet