Since the beginning of November, the Russian ruble has entered a new round of depreciation, with its decline catching even analysts off guard.

During Wednesday’s European trading session, the USD/RUB surged by over 4%, breaking past the 110 ruble mark—the highest level since the outbreak of the Russia-Ukraine conflict.

The ruble also fell against the euro, dropping below 120 rubles per euro, with intraday losses exceeding 9%. Meanwhile, the Chinese yuan strengthened against the ruble, climbing over 5% to reach 15.35.

  Russia Faces Another Round of Sweeping Sanctions  

According to reports, many analysts believe that apart from Russia's military actions in Ukraine sparking a new round of tensions with the West and resulting financial sanctions, there are no other significant reasons for the ruble's decline.

Last week, the U.S. Treasury Department announced sanctions on Gazprombank, over 50 Russian small and medium-sized banks, more than 40 Russian securities institutions, and 15 Russian financial officials. Previously, Gazprombank was the last major Russian financial institution not under sanctions.

Most of Russia's major banks are now sanctioned by Western nations, preventing them from transferring funds in U.S. dollars to other banks. The only remaining option is to import large amounts of physical dollars.

Since the Russia-Ukraine conflict began, Russia's economy has been severely impacted by Western sanctions. Last year, Russia's energy revenue fell by nearly a quarter, partly due to Western trade restrictions, including the $60-per-barrel price cap on Russian oil.

On the 25th, the UK announced sanctions on two Russian insurance companies. Additionally, 30 vessels associated with Russia were added to the sanctions list.

On the 26th, the Russian Foreign Ministry announced sanctions on 30 British citizens in response to the UK government's "hostile actions."

The Russian Foreign Ministry issued a statement that day, accusing the UK government of consistently making aggressive anti-Russian statements, imposing illegal unilateral restrictions, and supporting the Ukrainian regime to pursue geopolitical interests, thereby unnecessarily prolonging the Ukraine conflict.

In response to the UK’s "hostile actions," Russia decided to ban entry for a group of British political figures, military group representatives, high-tech enterprise executives, and media personnel who have shown anti-Russian stances.

The sanctions list includes UK Deputy Prime Minister Angela Rayner, Home Secretary Yvette Cooper, and Chancellor of the Exchequer Rachel Reeves, among others.

On the 26th, the Russian Federal Security Service reported that a diplomat from the British Embassy in Russia was ordered to leave for violating Russian laws and engaging in intelligence activities that threatened Russia's security. On the same day, the Russian Foreign Ministry summoned the British Ambassador to Russia to lodge a formal protest regarding the incident.

  The Russian Central Bank has taken action  

According to a report from Caixin, many analysts expect the exchange rate of the US dollar to the Russian ruble may reach 115–120 rubles per dollar by the end of the year.

The Russian Central Bank has taken action.

According to CCTV News, on November 27, the Russian Central Bank issued a statement announcing that it would suspend foreign currency purchases in the domestic market from November 28, 2023, until the end of 2024.

The Russian Central Bank stated that this decision would help reduce financial market volatility. It also mentioned that a decision on whether to resume foreign currency purchases would be made in early 2025 based on the country's actual economic conditions.

Source: Information from the internet and other sources. If there are any copyright issues, please contact us promptly for removal.