A currency the most protected from sanctions is unveiled! Given that the “magic currency” was found out by the Bank of Russia, you might guess which national currency owns such a title. The fact is that the freely convertible ruble is rather buoyant and safeguarded. Having such a trump card, the Russian central bank is not going to shift the currency corridor. Moreover, Ksenia Yudayeva, the first deputy chairperson of the Bank of Russia, stated that the control over the currency is considered inefficient measure in any circumstances.
So, here is a new axiom introduced by the Russian regulator – keep your money in rubles. Recently, the Finance and Economic Development Ministries’ officials had a discussion about placing restrictions on free capital movement. Such measures could provoke sharp capital inflow and three-month devaluation of the ruble caused by Ukraine’s unrest. As of Q1 2014, more than $70 billion were withdrawn from the Russian Federation. According to the Ministry of Economic Development, at least $150 billion will be missing by the end of the year. That amount is going to set a new record.
The current year is not so promising for the Russia’s national currency as it lost about 15% versus the U.S. dollar and the euro. Nevertheless, the ruble has gained ground last week. Let’s hope that the trend will sustain with no need for additional restrictions. The currency control aimed to curb export, import and circulation of foreign currency within Russia, is one of the most extreme measures. Besides, the locals might not be allowed to own foreign currency and pay with it for purchases. Furthermore, currency movement across the national borders and foreign currency deposits might be subjects to control as well.
