In April, the Russian ruble reached a value of 82 per USD, marking its strongest level in nearly two years. This strength was bolstered by several factors: a significant drop in the dollar's value, the implementation of capital controls, and the maintenance of high interest rates by Russia's central bank. The imposition of US tariffs and subsequent retaliatory actions by other economies have led to concerns about disruptions in global capital flows, prompting capital outflows from both the US and riskier emerging markets. However, Moscow's capital controls effectively deterred domestic investors from moving away from ruble-denominated assets. Furthermore, Russia's minimal economic interactions with Western countries contributed to a reduced urgency for capital flight, offering some stability in the outlook for Russian trade.
As a result, the currency appreciated despite a significant decrease in the prices of energy and key metals, which are crucial exports for Russia and important sources of budget revenue for the Kremlin. Currently, the Central Bank of Russia, as anticipated, has maintained its policy rate at 21% at its latest meeting, exhibiting a more optimistic perspective on the process of reducing inflation.
