This past week, the Russian ruble hit a new multi-year high versus the US dollar and the euro, despite US sanctions.
The Rubel continues to gain ground even as Russia’s central bank loosened capital controls imposed in March in response to Western sanctions.
There are several reasons for the surge–
- Russian regulators eased rules for the sale of hard currency earnings on Monday, ahead of this week’s tax payment deadlines for exporters. Exporters must now sell only 50% of their revenues, down from an earlier requirement of 80%.
- On Thursday, the Russian central bank announced it will slash its main interest rate even further.
- More European corporations are complying with Moscow’s demand that natural gas imports be paid in rubles, giving the currency a boost.
- A record volume of Russian oil is on board tankers, with unprecedented amounts heading to India and China. Between 74 million and 79 million barrels from the OPEC+ producer were in transit and floating storage over the past week, more than double the 27 million barrels just before the February invasion of Ukraine.
Bloomberg recently named the ruble the world’s best performing currency this year.