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Russian ruble devaluation #russia #ruble #euro #currency

rouble

While the President of the Donetsk People’s Republic, Alexander Zakharchenko, announced yesterday that he wanted to adopt the Russian ruble as national currency (in order to exchange with Russia and hoping to stabilize the economy), the exchange rate of the ruble doesn’t stop sinking.

However, the Russian ruble has been used for 700 years in a lot of different countries (nowadays we can name Byelorussia and the Abkhazia). Since then, why does it suffer from such a devaluation?

In August 2014, 1 euro represented 48,65 Russian rubles, and 1 dollar,  37,09 rubles.
Currently, 1 euro amounts to 68,71 rubles and 1 dollar 60,71 (26/02.2015). This collapse falls to the “Ruble crises”, that begins in July 2014 and reaches its height in December of the same year (the 16th of December, 1 euro equaled 84,90 rubles and one dollar, 67,91 rubles).

Some reasons might explain this : the drop of oil prices (oil represents 2/3 of Russian exportations and half of its revenues), speculations against ruble and the economic sanctions imposed by the USA and the European Union.

This crises leads to concrete repercussions on the Russian daily life : an important capital flight and increasing of the prices by 10%. People invest and buy furnitures, cars and electrical appliances.

Anastasiya Tretyak

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