Russia’s economy nears meltdown as ruble plummets
The Russian ruble has dropped to a record low not seen since the early weeks of the conflict in Ukraine.
This sharp decline follows the implementation of new U.S. sanctions targeting Russian banks, including Gazprombank, which handles payments for gas sales among other transactions.
As of Wednesday, the exchange rate was 113 rubles to the dollar. In response, Russia's central bank swiftly intervened, temporarily halting the purchase of foreign currencies to slow the ruble's descent.
Gazprombank facilitates international transactions, and these sanctions are expected to significantly reduce Russia's revenue from gas exports—a major source of funding for its war in Ukraine.
After months of gradual devaluation, the ruble experienced a sudden drop this week, exacerbated by bleak economic growth forecasts for 2025. Despite the growing deficit, the Russian government has no plans to cut military spending.
(QG - The Financial Times / Reuters / Picture: © Unsplash)