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Russian rouble falls to new low against US dollar | Russian rouble falls to new low against US dollar |
(35 minutes later) | |
The Russian rouble has dropped to a new low against the US dollar, as falling oil prices and Western sanctions continue to weigh on the country. | The Russian rouble has dropped to a new low against the US dollar, as falling oil prices and Western sanctions continue to weigh on the country. |
As of Monday afternoon, it takes more than 60 roubles to buy a single dollar. | As of Monday afternoon, it takes more than 60 roubles to buy a single dollar. |
The 60 mark is considered a "psychological barrier" for Russia's national currency, says the BBC's Moscow correspondent, Steve Rosenberg. | The 60 mark is considered a "psychological barrier" for Russia's national currency, says the BBC's Moscow correspondent, Steve Rosenberg. |
Since the start of the year, the rouble has lost more than 45% of its value against the dollar. | Since the start of the year, the rouble has lost more than 45% of its value against the dollar. |
Russia's central bank has tried unsuccessfully to stabilise the currency, buying roubles in the markets and raising its main lending rate to 10.5%. | Russia's central bank has tried unsuccessfully to stabilise the currency, buying roubles in the markets and raising its main lending rate to 10.5%. |
But those efforts have been overwhelmed by the fall in the price of crude oil - one of the country's main exports - and by concerns that international sanctions over Ukraine might be stepped up. | But those efforts have been overwhelmed by the fall in the price of crude oil - one of the country's main exports - and by concerns that international sanctions over Ukraine might be stepped up. |
Russian authorities appear unable to bring down inflation either - prices are expected to be 10% higher by the end of the year. | Russian authorities appear unable to bring down inflation either - prices are expected to be 10% higher by the end of the year. |
Interventions | Interventions |
In November, Russia's central bank announced it was going ahead with a free float of the rouble by abolishing its unofficial link to the euro and the US dollar. | In November, Russia's central bank announced it was going ahead with a free float of the rouble by abolishing its unofficial link to the euro and the US dollar. |
It also announced it was ending automatic interventions to support the currency, instead propping it up only when it was deemed necessary. | It also announced it was ending automatic interventions to support the currency, instead propping it up only when it was deemed necessary. |
The bank had previously supported the rouble when the exchange rate against the euro and dollar exceeded certain limits. | The bank had previously supported the rouble when the exchange rate against the euro and dollar exceeded certain limits. |
However, last week, the bank admitted it intervened to support the rouble in foreign currency markets, spending a total of $4.53bn. | However, last week, the bank admitted it intervened to support the rouble in foreign currency markets, spending a total of $4.53bn. |
Oil woes | |
The rouble has been heavily affected by the price of oil, which has been in steady decline in recent months. | |
On Monday, Brent crude fell to almost $60 per barrel - a five-year-low - before recovering to just above $62. | |
The dip came after the head of oil cartel Opec reiterated at the weekend that the group would not reduce production to help shore up oil prices. | |
Russia's central bank has warned that the country's gross domestic product could contract by approximately 4.5% next year, if oil remains at $60 a barrel. |