The world’s major reserve currencies plunged on the Moscow Stock Exchange amid geopolitical uncertainty
The Russian ruble strengthened to new highs against the euro and the US dollar during Friday’s trading on the Moscow Stock Exchange amid the threat of new Western sanctions, as the two Donbass republics, as well as the Zaporozhye and Kherson regions, are about to become part of Russia. .
The euro was trading at its lowest level in eight years against the Russian currency, at 51.1 rubles at 12:10 GMT. The EU currency briefly dipped below 51 rubles at one point. The dollar rate fell below 54 rubles for the first time since July.
The world’s two main reserve currencies fell against the ruble amid growing geopolitical tensions. The ruble has remained strong in recent months due to limited demand from importers, who are already struggling with the effects of sanctions on Moscow.
Analysts explain the imbalance in the ratio of currencies by the large-scale selling of the euro and the dollar in the absence of demand on the Moscow Stock Exchange. On Thursday, the adviser to the first vice president of the Central Bank of Russia, Sergey Moiseev, said trading in dollars and euros could be halted if sanctions are introduced against the Moscow Stock Exchange.
Putin recognizes the independence of Zaporozhye and Kherson
The rise in the ruble comes as Russian President Vladimir Putin on Thursday signed two decrees recognizing the former Ukrainian regions of Kherson and Zaporozhye as independent sovereign states. This decision came on the eve of the official ceremony during which the Russian president is expected to sign treaties on the integration of the Kherson and Zaporozhye regions, as well as the two Donbass republics, into Russia. Referendums on joining Russia were held in Zaporozhye and Kherson, as well as in the Donetsk People’s Republic (DPR) and the Lugansk People’s Republic (LPR), from 23 to 27 September.
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