Russia's economy under pressure as ruble weakens

DW (English)

Russia's currency has hit its weakest level since its invasion of Ukraine. The depreciation of the rubel comes after Washington sanctioned Gazprombank and challenges are mounting for Moscow to manage its war economy.

Transcript

00:00The ruble has fallen to its lowest value against the dollar since the invasion of Ukraine began

00:06in 2022, but the slide will bring some benefits to the government.

00:14If the currency is weak, it will be easier for the Russian government to decrease the

00:20deficit, the shortage of the budget, because the payments within Russia would be in weak

00:28rubles, and whatever payments come from Russian experts will be in hard currency, and this

00:37is a natural tool for improving the shape of the budget.

00:45At a press conference, President Putin appeared relaxed about the ruble.

00:50There are many, many, many factors of a seasonal nature, so in general, in my opinion, the

00:57situation is under control, and there's absolutely no grounds for panic, well, how can I say

01:02it?

01:05But the weakening currency is threatening to erode the purchasing power of the Russian

01:09people, it would further increase the cost of imported goods, and could flare up already

01:14runaway inflation.

01:18The fall follows fresh US sanctions on Gazprom Bank, a key conduit for Russia's energy revenues

01:24That'll make payments more complicated for European nations still buying fossil fuels

01:28from Russia.

01:31And I think that some of European countries are going to suffer, because they will have

01:37to find a new chains of payment to Gazprom, or to Russian oil companies for deliveries

01:44of refined petroleum products, natural gas, Turkey and Hungary are already complaining,

01:53and they have admitted that they are looking for some bypasses to organise the payments

02:01to Russia.

02:04Russia's central bank now says it's pausing foreign currency purchases in order to ease

02:09pressure on financial markets.

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