Sanctions Push Rouble to All Time Low

The Russian rouble has fallen to a new all-time low against the US dollar amid concerns about the effect of sanctions on the country’s economy.

The rouble fell about 1% to 38.72 per dollar, the weakest it has been since the currency was restructured in 1998.

Last week, the US and Europe introduced further sanctions against Russia for its actions in Ukraine.

Former finance minister Alexei Kudrin said on Tuesday sanctions would have a material impact on the Russian economy.

“The sanctions that have been imposed are going to have an effect for the next one or two years because they have limited opportunities for investment in this uncertain environment,” he said, according to Interfax news agency.

New sanctions imposed on Friday last week targeted Russia’s state finances, energy and arms sectors.

Russian state banks are now excluded from raising long-term capital in the European Union, export bans have been extended, while future EU-Russia arms deals are also banned.

The EU has also followed the US in targeting more individuals in President Putin’s inner circle, as well as some major companies.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza