INSUBCONTINENT EXCLUSIVE:
can the Kremlin carry on funding its war against Ukraine without triggering a surge in inflation and fresh fears of an economic crisis at
home?The ruble dipped below the crucial level on Monday for the first time since March 2022, when the Russian economy appeared to be on the
Last year, sweeping capital controls, an emergency interest rate hike and a rapid surge in the production of guns, missiles, tanks and
Russians who have grown accustomed to economic crises in the three decades since the fall of the Soviet Union, the ruble exchange rate has
outflows to foreign banks have jumped 41%, he noted.Exchange rates in Moscow exchange offices on August 14, 2023.Arthur Novosiltsev / Moskva
News AgencyKogan said a sustained breakthrough of 100 rubles against the dollar could lead to serious price hikes by companies that use
imported goods or equipment, and it might trigger financial panic among the population.Across Russian society, a feeling that the government
cares little about the falling ruble is spreading, with talk of how the Kremlin benefits from a falling currency cropping up across Russian
The same fall adds 0.5-1 percentage point to inflation, Kogan estimates.Those extra funds are sorely needed by Moscow, which has chalked up
a 2.8-trillion ruble ($28 billion) budget deficit so far this year.A weaker ruble means Russia can buy more arms, ammunition and pay higher
few months, or until spring, and in the long run, if things turn out worse because of this, then it doesn't really matter
priority, analysts are poised for potentially drastic action from the Central Bank, whose main task since the invasion has been to mitigate
But that measure had little effect in halting the ruble's descent
effect in stopping the slide as it did 18 months ago
controls, like forced conversions of foreign currency earnings, should only be temporary measures and reserved for major financial crises
