"The Russian Ruble Is Flying Into The Abyss."
2- 11.09.2025, 13:13
- 7,174
Euro exchange rate exceeded Br100 for the first time since February.
The ruble continues to depreciate on the Moscow Exchange, updating multi-month lows against the dollar, euro and yuan, writes
On Thursday on the over-the-counter market for the first time since February, the rate of the European currency rose above 100 rubles - transactions were held at 100.3850 rubles per euro.
The dollar's over-the-counter exchange rate updated a record since April 10 - 85.91 rubles. And the yuan exchange rate on Mosbirzh reached 12.05 - the highest since March 10.
The ruble continues to "fly into the abyss," states investment banker Evgeny Kogan. The market has not seen such a long decline in the ruble - 8 days in a row - since December 2022, while the dollar has risen by almost 10 rubles (12%), the euro - by 12 rubles (13%), and the yuan has become more expensive by 1.2 rubles (11%) against the lows shown in the summer.
The ruble's weakness "is largely due to a fundamental trend reversal due to the deterioration of the trade balance," explains BCS analyst Ilya Fedorov: the economy's export revenues are shrinking due to falling oil prices, sanctions and reduced trade with China, while demand for the currency has started to grow again due to the need for imports.
The ruble may fall to 90-95 rubles per dollar by the end of the year, predicts Dmitri Sergeyev, chief investment adviser at IK Veles Capital. "A managed depreciation of the exchange rate is one of the ways to rectify the budget situation," he explains: in 8 months, the "hole" in the federal treasury has reached 4.2 trillion rubles, which is three times higher than the original plan for the year, and oil and gas revenues have fallen by 20%.
"On August 14, the requirement of mandatory sale of export proceeds to exporting companies was canceled," Sergeev recalls. And this was preceded by numerous complaints from commodity billionaires and state-owned companies that the ruble was too strong. "Rosneft head Igor Sechin called the ruble exchange rate "unmarketable" after the company's profit for the first half of the year collapsed threefold, and VTB head Andrey Kostin called on the Finance Ministry and the Central Bank to "adjust" the ruble to help the budget.
"Sanctions restrictions, an increase in the transportation leverage and the growth of discounts on hydrocarbon exports can be smoothed, again, through the exchange rate," Sergeev explains.
A side effect of devaluation, however, will be a new acceleration of inflation. "Very soon it will be reflected in the growth of retail prices," warns Alor Broker analyst Alexei Antonov. In this regard, he adds, the Central Bank at the meeting on Friday may reduce the rate not by 2 percentage points, as the market expects, but only by 1 p. p.
The ruble is pressured by geopolitical uncertainty and deterioration of Russia's macroeconomic indicators - the slowdown in GDP growth, the growth of the budget deficit, lists leading analyst Freedom Finance Global Natalya Milchakova. A "breakthrough" in the settlement in Ukraine could slow down the ruble's fall, and if the peace plans are derailed, the dollar could soar to 100 rubles, the expert does not rule out.
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