Ruble tumbles as Russia’s war economy comes under increasing strain \ stacker news ~econ

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Ruble tumbles as Russia’s war economy comes under increasing strain www.politico.eu/article/ruble-value-falls-russia-war-economy-ukraine-oil-prices-sanctions-inflation-interest-rates-oligarchs/#:~:text=The%20ruble%20tumbled%20on%20Wednesday,strain%20on%20the%20Russian%20economy.

1344 sats \ 7 comments \ @south_korea_ln 22h econ

zaps forwarded to @gmd (33%)

The ruble tumbled on Wednesday to its lowest level in over two years, as a mix of low oil prices, new sanctions against Russian businesses and burgeoning government spending on its war effort put ever-greater strain on the Russian economy.

The central bank reacted by suspending currency purchases for the rest of this year. That will restrict the supply of rubles and should support the exchange rate accordingly. It took a similar step last year, after the mutiny of mercenary leader Yevgeny Prigozhin triggered another crisis of confidence.

As such, the measure will help to keep a lid on a growing inflation problem, which has forced the central bank to raise its key interest rate to 21 percent. Official data show inflation running at 8.5 percent, but private surveys such as those by market research firm ROMIR suggest that the actual rate is much higher.

Anyone with booths on the grounds here? Are things accurately portrayed in this article?

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1075 sats \ 3 replies \ @stack_harder 22h

I'll chime in on this as my wife is Russian and all her family are there and I've been following some non-regime economists since the start of the war. The ruble has, in some way or another, caused me a pain in the ass for about a decade lol.

Since the 90s, the ruble-to-dollar rate has acted as a sort of barometer for average Russians because usually, a high dollar-to-ruble would be during hard times, defaults, hyperinflation etc.

When it goes past 100, people start panicking and start trying to do whatever they can to get their hands on either goods or a harder currency. It has a strong psychological effect.

What is said in this article is correct (apart from quoting the 'official' inflation rate which is probably more like 17-20%, 8.5% is just fairy-land statistics) the central bank doesn't really have many other options left because the war and military spending are the underlying problem, the head of the central bank is now being used as a scapegoat and Putin is, as usual, getting away with it - more or less.

What the article doesn't say is that this is actually good news for the Russian gov and budget deficits because they are now getting way more rubles for the oil they sell (which is in dollars or other currencies). So the weaker the ruble, the easier it is for the regime to keep ticking along and making its payments.

Now, it's terrible for the average person, but that's nothing new. That being said, the gov will probably tighten measures to make sure it doesn't stay past the 110 mark for too long.

Here is a good video summing up recent developments, it's in Russian, but has good quality English subs

33 sats \ 2 replies \ @south_korea_ln OP 21h

Thanks for chiming in~~ I will try to watch the movie later today.

Putin is, as usual, getting away with it

How does the average (?) Russian think of him these days?

204 sats \ 1 reply \ @stack_harder 14h

hard to say as at the moment, most Russians know they have to be quite careful with what they say, i don't message my friends there about him as they could get in trouble if the messages were seen etc

A lot of Russians will still support Putin as they believe at this point that Russia had to attack because Ukraine was going to attack first.

Speaking of my family-in-law, they sadly all believe and repeat everything that is on the tv, the invasion narrative has changed a few times, and they follow along with it. They don't like the fact there is a war and want it to be over, but are convinced that Ukraine was going to invade first therefore Putin had to strike first. Very similar narrative that was used by Hitler. My brother in-law is convinced the US was going to attack Russia and that Russia just wanted to protect the people in Donbass. He's wrong, on both points, but in his mind, he is on the side of good, people don't want to feel like they are the baddies after all.

One other thing that the tv and propaganda do well is find scapegoats to blame, so when bad things happen, Putin is never directly blamed, also in times of crisis, he will just disappear from the public eye for a few weeks, I think it's so he's not associated with anything bad.

The final thing worth mentioning is the whole focus is on NATO and America, this was the case ten years ago too, it's like people are more obsessed with what the US is doing than their own gov. Russians have a good saying which is 'Russians never had it so bad as under Biden' (Никогда ещё русские не жили так плохо как при Байдене).

Opinions will differ based on age and region as well, Moscow is largely insulated from most things, whereas someone in Chelyabinsk will have a different experience, same with Kursk etc

11 sats \ 0 replies \ @gmd fwd 11h

It's very scary how quickly we can lose all of our rights now in the new age of AI. Infinitely scalable surveillance software makes it impossible to organize any sort of rebellion or share any media to counter the state narrative... we don't hear much about the resistance efforts in hong kong anymore.

142 sats \ 0 replies \ @gmd fwd 22h

Hmmmm looks like RUB is making a bit of a comeback in the past hour alone... wonder what news or intervention is going on...

117 sats \ 0 replies \ @gmd fwd 22h

Just playing around on TradingView but it also appears to have similarly markedly dropped in value against the INR, MXN and EUR so at least it seems consistent and not just some USD-RUB trade issue...

99 sats \ 0 replies \ @jddska 21h

Also brazilian currency is tumbling...looks like some brics move