The Russian stock market took a dive Monday as war fears triggered a massive sell-off with tens of billions of dollars wiped from the value of some of t
The Russian stock market took a dive Monday as war fears triggered a massive sell-off, with tens of billions of dollars wiped from the value of some of the country’s leading businesses. As concerns mount that President Vladimir Putin is poised to order an invasion of neighboring Ukraine, the ruble also hit a 14-month low, prompting the Central Bank to intervene by halting its regular purchases of foreign currency to help prop up the ruble. “The Bank of Russia has decided not to purchase foreign currency on the domestic market,” the bank said in a statement. “This decision was made in order to reduce the volatility of financial markets.” The bank regularly converts the proceeds of the country’s oil and gas exports to avoid the ruble being impacted by swings in the value of global commodities. The bank offered no details on when it would resume buying foreign currencies. The ruble was down 2.3% in early Monday trading but steadied after the bank’s announcement. Meanwhile, the Russian stock market plunged more than 10% on Monday but was 7% down when trading concluded. Since the start of the Russian military buildup on the borders of Ukraine in October, the market has lost more than a quarter of its value. Anders Aslund is chairman of the International Advisory Council at the Center for Social and Economic Research, a policy group in Warsaw, Poland. Aslund predicts the market could fall much further if the geopolitical confrontation between Russia and Western powers over Ukraine worsens. “So far, the Russian RTS stock index in USD has only fallen 27% from its high point on October 27 before Putin started threatening Ukraine,” Aslund tweeted. “It has far more to fall.
