23.09.202510:46:56UTC+00Russian Ruble Hovers at 5-Month Low

The Russian ruble has depreciated to approximately 83.5 per USD, nearing its lowest point since April. This decline is primarily attributed to the impact of international sanctions and weak commodity prices, which have restricted the flow of hard currency into Russia's largely isolated financial system. Both the European Union and the United States have intensified their sanctions rhetoric against Russia following its invasion of Ukraine. Notably, the EU has proposed a new sanctions package targeting the Russian oil industry and has set plans to implement a complete ban on Russian liquefied natural gas (LNG) by 2027. Concurrently, abundant oil production from other OPEC+ countries and major producers in the Americas has further strained foreign exchange earnings from energy exports. This situation not only threatens the Russian economy but also puts additional pressure on the Kremlin to identify revenue sources in its forthcoming budget to support rising military expenditure. On the monetary policy front, the Central Bank of Russia recently reduced its key interest rate by less than anticipated, curtailing the ruble's decline. Consequently, financial markets have scaled back expectations for further rate reductions this year, given the looming possibility of increased taxation in the new budget.