Russian Ruble Hits Lowest Against Dollar in Over 2 Years Due to "Bank Sanctions Impact"

Yonhap News

The value of the Russian ruble against the US dollar hit its lowest point in over two years as Russian banks became targets of US sanctions.

On the 22nd (local time), the Central Bank of Russia set the official dollar exchange rate for the weekend (23rd-24th) and the 25th at 102.58 rubles.

This is the highest rate since March 2022. Russian media reported that the ruble's value against the dollar fell to its lowest level in about two years and eight months.

In the over-the-counter market on the 22nd, the dollar exchange rate surpassed 103 rubles. This was also the first time since March 2022 that such a figure was seen.

The Russian daily Kommersant analyzed that the ruble weakened as tensions between Russia and the West escalated and Russian banks became targets of US sanctions.

On the 21st, Russia increased geopolitical instability by launching the new medium-range ballistic missile Oreshnik at Ukraine. This was a response to Western countries allowing Ukraine to strike Russian territory with Western long-range missiles.

On the same day, the US announced sanctions against Russia's Gazprombank. Gazprombank is a key bank used by European countries to receive Russian gas supplies and make payments. These sanctions will restrict Russia's ability to export gas to Europe.

Evgeny Kogan, a professor at the Higher School of Economics in Moscow, told Reuters, "The biggest reason the ruble continues to fall is the sanctions on Gazprombank, which was the central bank for exporters."

He also forecasted that the exchange rate by the end of the year would be higher than the initially expected 97-99 rubles per dollar, estimating it to be 104-106 rubles per dollar.