CBR Tackles Geopolitically Motivated Ruble Depreciation, Boosts Key Rate to 20 Percent
Russia’s central bank, CBR, has more than doubled its key interest rate from 9.5% to 20% as its currency
The ruble, hit a record low against the dollar on the back of a slew of new sanctions and penalties imposed on Russia by Europe and the U.S. for its invasion of Ukraine.
The rate hike, the central bank said, “aimed to offset increased risk of ruble depreciation and inflation.” This follows the central bank’s order to halt foreigners’ bids to sell Russian securities in an effort to contain the market fallout. The ruble fell as far as 119.50 per dollar, down a whopping 30% from Friday’s close.
The financial regulator also said it would be freeing 733 billion rubles (around $8.78 billion) in local bank reserves to boost liquidity.
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Covid Aid Dropped From U.S. Lawmakers’ Big Spending Deal
U.S. lawmakers late Wednesday passed a massive new bill that would fund the federal government for the remainder of the fiscal year, as well as further aid Ukraine, but a last-minute snag resulted in Covid-19 money being dropped.
Fed Chair Powell Left Open Possibility Of Hiking More Aggressively Should Inflation Persist
Fed Chairman Jerome Powell said Wednesday he still sees interest rate hikes ahead though he noted the “implications for the U.S. economy are highly uncertain” from the Ukraine war.
