Ruble Falls on Wednesday as Sanctions Worry Spook Investors

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On Wednesday, as concerns over sanctions on Russian oil and gas shook the market, the ruble (RUB) fell to its lowest point against the dollar since early May, passing the 70 mark. This brought the month’s losses to roughly 14%.

After reaching 70.7550 earlier today, the ruble was down 2.5% versus the dollar as of the North American session, trading at 70.60.

Meanwhile, the single currency had dropped 2.4% and was now trading at 75.22 against the euro (EUR), breaking through the 75 mark for the first time since late April. It dropped 2.1% against the yuan to 10.10, a level not seen in nearly seven months.

Ruble Loses Spot as Best-Performing Currency for 2022

The ruble has already fallen against the dollar by more than 8% this week and by almost 12% overall since a ceiling on Russian oil prices went into effect. It has now been surpassed by the Brazilian real as the best-performing major currency globally this year.

Among the less liquid currencies that have risen sharply this year are the dram of Armenia and the lari of Georgia. Since the start of the conflict in Ukraine, tens of thousands of Russians have fled to countries like Armenia and Georgia.

Capital controls and an early drop in imports as a result of Western sanctions over Russia’s activities in Ukraine this year have helped to boost the Russian ruble.

As Russia’s balance of payments has weakened, the currency has been catching up, according to Ziemba Insights founder Rachel Ziemba. “In recent months, Russian export revenues have fallen as it sharply reduced gas exports, and the EU oil embargo is limiting oil revenues.”

According to the Kommersant daily on Wednesday, which cited unnamed people with knowledge of the issue, Russian oil shipments decreased by 11% for the period of December 1 through 20 compared to the prior month.