US dollar falls sharply against Russian ruble amid US-Russia negotiations

The Central Bank of Russia (CBR) has sharply reduced the official exchange rate of the US dollar, setting it at 86.6 rubles for Wednesday, March 11. This information was published on the regulator's official website.

Photo: flickr.com by Фотобанк Moscow-Live, https://creativecommons.org/licenses/by-nc-sa/2.0/

Russian rubles

On Tuesday, March 10, the official exchange rate stood at approximately 88.4 rubles, meaning the dollar has dropped by 1.8 rubles. The euro also saw a decline of 1.7 rubles, falling from 95.4 to 93.7 rubles. Meanwhile, the Chinese yuan's exchange rate was lowered by 23 kopecks, from 12.08 to 11.85 rubles.

This marks the second consecutive day that the Central Bank has reduced the exchange rates of foreign currencies. The previous day, the dollar had been lowered by nearly 1 ruble, while the euro dropped by 1.5 rubles. The official exchange rate of the yuan was also reduced by approximately 16 kopecks.

Strengthening of the Ruble Amid US-Russia Negotiations

The ruble began strengthening against the dollar after negotiations between Russia and the United States regarding the cessation of hostilities in Ukraine. Following a phone conversation between Presidents Vladimir Putin and Donald Trump, the dollar exchange rate fell below 90 rubles.

Key factors supporting a weaker ruble – including falling oil prices and Western sanctions – remain in place.

• According to Evgeny Loktyukhov, Head of Economic and Sectoral Analysis at PSB, the Russian currency is experiencing technical overheating, while geopolitical influences on its exchange rate are diminishing.
• Meanwhile, Darya Tarasenko, Senior Analyst at Gazprombank's Center for Economic Forecasting, expects the dollar to rise to 100 rubles within the next six months, driven by declining prices of Russia's key export commodities.

Details

The ruble or rouble is a currency unit. Currently, currencies named ruble in circulation include the Russian ruble (RUB, ₽) in Russia and the Belarusian ruble (BYN, Rbl) in Belarus. These currencies are subdivided into one hundred kopeks. No kopek is currently formally subdivided, although denga (½ kopek) and polushka (½ denga, thus ¼ kopek) were minted until the 19th century. Additionally, the Transnistrian ruble is used in Transnistria, an unrecognized breakaway province of Moldova. Historically, the grivna, ruble and denga were used in Russia as measurements of weight. In 1704, as a result of monetary reforms by Peter the Great, the imperial ruble of the Russian Empire became the first decimal currency. The silver ruble was used until 1897 and the gold ruble was used until 1917. The Soviet ruble officially replaced the imperial ruble in 1922 and continued to be used until 1993, when it was formally replaced with the Russian ruble in the Russian Federation and by other currencies in other post-Soviet states. In the past, several other countries influenced by the Russian Empire and the Soviet Union had currency units that were also named ruble, including the Latvian ruble, Tajikistani ruble and Transcaucasian ruble (later Armenian ruble, Azerbaijani ruble, Georgian ruble).