By Russia’s Central Bank set the official ruble exchange rate above 100 to the dollar for Wednesday, marking the first breach of this psychological threshold in more than a year and highlighting growing economic pressures amid escalating military tensions.
The new rate of 100.03 rubles per dollar represents a sharp 19% devaluation since Ukraine’s unexpected military operation into Russia’s Kursk region on August 6. The currency’s decline intensified following President Vladimir Putin’s recent decision to lower nuclear strike thresholds in response to U.S. authorization for Ukraine to deploy long-range missiles against Russian targets.
This latest currency weakness mirrors a similar decline in October 2023, when the ruble last crossed the 100-per-dollar mark amid growing concerns over economic slowdown and inflationary pressures. While Putin implemented stabilization measures during that previous decline, Bloomberg reports that Moscow officials now appear less concerned about currency weakness as they prepare for significant increases in military expenditure.
The Central Bank has maintained control over official exchange rates since June, when U.S. sanctions forced the Moscow Exchange to suspend dollar and euro trading. Current rates are determined through over-the-counter transactions between major exporters and commercial banks.
The weakening currency threatens to impact Russian consumers’ purchasing power, particularly affecting prices for imported goods. The ruble previously experienced a historic low of 150 per dollar immediately following Russia’s 2022 invasion of Ukraine, temporarily stabilizing after the Central Bank implemented strict capital controls.
