The central monetary authority of Russia took rate-cut steps again this year, lowering its benchmark repo rate from 15.00% to 14.00%, adding to previous cut made in January. Nevertheless, analysts had expected such move, as current oil price drop hurts the eastern European economy strongly. The black gold commodity plays key role in Russia’s exports and Western sanctions are already doing their job due to Ukrainian crisis. These steps showed central bank’s intention to focus more on economy’s progress instead of inflation worries, previously regarder as top 1 issue.
Although such moves tend to undermine currencies, USD/RUB remains trading around RUB62 for a month. The largest volatility was seen in the previous year due to development in Ukraine’s crisis.
