Russia Temporarily relieved after teetering financial abyss The Russians, who were afraid of reliving the traumatic currency crises of 1998 or 2008, breathe a sigh of relief with the rest observed in the foreign exchange market, which could be short-lived given the renewed tensions in Ukraine. The plunge of nearly 10% of the ruble in the space of a few days last week left the Russians stunned and given a dramatic turn to the decline of the currency. In total, she has lost a quarter of its value since the beginning of the year amid Ukrainian crisis, exacerbated by the recent fall in oil prices. I was scared, admits Natalia, a 26 year old Muscovite. At first I thought it was speculation and that everything would be correct. But now there is much uncertainty. This commercial framework says he wanted to convert part of their savings in foreign currencies to protect the loss of value, before changing his mind when the fall of the ruble has subsided. And now? No idea, she says, convinced that the crisis is not over. Queues in front of ATMs, exchange offices to bother to respond to the demand for foreign exchange: without reaching a massive, this information has raised fears of a panic and the ruble entry into a downward spiral out of control. In extremis, the central bank, publicly supported by President Vladimir Putin seems to have extinguished the fire by clarifying its policy and warning speculators impact interventions if the financial system was threatened. The ruble is taken away to recover the ground lost last week. Russia has moved to a hair of a monetary crisis of major proportions, said Chris Weafer Economist, Macro Advisory firm. But the major threat remains. Russia remains covered by unprecedented sanctions against its economy, especially its banking sector. Oil prices, which provides the majority of the gas tax revenues of the country are persistently downward trend. The ruble was not recovered enough to curb soaring current prices (inflation exceeds 8%). Ukrainian crisis, hush oil prices, none of the reasons (for the fall of the ruble, note) has disappeared, which means that the ruble will continue to fall, warned Igor Nikolaev, Director of the Institute FBK economic information on the RBK website. Prepare to that economic turmoil will not stop anytime soon, said he added. Households, if they continue to pay record trust Vladimir Putin, have rarely been so pessimistic about changes in their standard of living, according to opinion surveys and economic indicators. The last few days have revived painful memories of the post-Soviet period and especially the default of Russia in the summer of 1998 together in series of bank failures and a collapse of the ruble. Images of crowds gathered in front of the banks with the hope of recovering deposits, savings are worthless almost overnight, remain etched in the memories. Ten years later, the country had suffered the brunt of the effects of the global financial crisis which saw oil lose three quarters of its value: the ruble fell in six months by nearly 40% against the dollar and the product GDP of about 8%. But compared to these two crises, followed by a vigorous economic recovery, the key difference is the political factor, said Weaver, noting that no solution is in sight in the East of Ukraine. In all cases, the horizon is black for Russia, whose economy was already in decline before the geopolitical crisis. Growth has already slowed to 0.7% year on year in the third quarter, according to figures released Thursday. Both authorities and economists warn that the worst is yet to come. The looming recession will be less severe but longer than in 2008-2009, warned in a note Alexander Morozov, chief economist at HSBC. This time, we are witnessing a structural recession (...) without door quick and easy exit.
Posted on: Fri, 14 Nov 2014 01:44:57 +0000
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