Kremlin downplays fall in ruble, citing stability
Russia remains optimistic that the country’s macroeconomic environment will remain stable in the face of a decline in its currency, Kremlin spokesman Dmitry Peskov said on Monday.
The ruble lost about 5 percent of its value against the US dollar in trading last week. The currency’s performance worsened at the start of this week, when the greenback fetched for more than 80 rubles on Monday, a level last seen at the end of March.
“Now, any world currency is under serious negative pressure from a number of circumstances in the global economy,” Peskov said.
In a news conference, Peskov said the currencies of all countries have been affected by the dynamics of changes in energy consumption and the resulting lower prices for petroleum products, including oil.
The Russian authorities are managing to minimize the volatility of the ruble exchange rate and to maintain macroeconomic stability, he said.
“The ruble is breaching psychological thresholds, but volatility is minimized by the efforts of our regulator,” he said. “But, in general, if we talk about macroeconomic stability, it is being maintained, as President Vladimir Putin had said.”
Putin, in response to the ruble’s depreciation, said last week that one should not pay too much attention to the exchange rate.
Peskov said: “In our country, the overwhelming majority of our fellow citizens receive their income in rubles. As we reduce our dependence on imports, the volatility of the ruble exchange rate, accordingly, affects the dynamics of price changes less and less.”
The weakening of the Russian currency has been taking place against the backdrop of falling oil prices since March.
Key influence
Oil prices — a key influence on Russia’s financial health — have dropped 10 percent since Oct 26 as concerns spread about another potential supply glut as the outlook for the economy weakens.
With Russia, Saudi Arabia and other members of the so-called OPEC+ grouping not set to meet until the end of November to discuss their future oil production plans, prices tumbled to $37 a barrel in Friday trading — the lowest level in five months.
According to The Moscow Times, Russian financial markets are expected to suffer another painful week amid a surge in volatility and investor fears over a second wave of the coronavirus and this week’s US presidential election.
On Tuesday, the Russian anti-coronavirus crisis center reported 18,648 new cases and 355 deaths from the previous day, bringing the country’s total number of infections to more than 1.67 million.