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HomeWorld NewsHow is Russia's ruble getting stronger despite sanctions? Biden was mocked

How is Russia’s ruble getting stronger despite sanctions? Biden was mocked

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A few days after the start of the Russo-Ukraine War, the collapse of Russia’s currency, the ruble, is considered a sign of the collapse of the Russian economy due to the effects of sanctions. Due to the decisions of Vladimir Putin, one dollar rose to 1 121.5. This brought back memories of the 1998 financial crisis. Russia’s economic situation was so bad that US President Joe Biden said that the ruble was in disarray. According to a source, but now the Russian currency has again reached the level before the invasion of Ukraine.

The ruble was trading at .7 79.7 per dollar in Moscow on Wednesday. It is clear that despite numerous sanctions on the Russian government and Russian lenders, they have remained unaffected, and foreigners still buy Russian oil and natural gas. The ruble is getting stronger and Putin is getting stronger.

Russia continues to earn
Despite being largely cut off from the global economy, Bloomberg economists estimate Russia will earn about $321 billion from its energy exports this year, which is about a third of its 2021 earnings.

With the recovery of the ruble, Putin could prove his big victory in Russia. Where many people are being harassed by the economy above and below the country and the army is being beaten up in Ukraine. The atrocities of Russia are also being condemned all over the world.

Russians take seriously the depreciation of their currency against the dollar. When Russia defaulted in 1998, inflation in Russia soared and the ruble collapsed. When that crisis ended, as in the 2008 crisis, Russian officials burned billions of dollars to protect the ruble from depreciation. But Russia’s governor, Elvira Nabiullina, took the risk after annexing Crimea in 2014 and promoted a free currency despite subsequent sanctions and plunging oil prices.

In response to this year’s sanctions, Russia imposed capital sanctions, which backed the ruble. It stagnated the assets of non-resident investors and asked Russian companies to convert 80% of their foreign currency into rubles.

Russia has since managed to stabilize the domestic market and avoid default. This means governments trying to damage the ruble will have to turn their backs on punishing Putin. This week, the US Treasury stopped making payments in dollars from Russian accounts in US banks to pay off debt. This is an attempt by Russia to clear its domestic dollar reserves or become a defaulter.

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