Russian Currency Slumps To New All-Time Low

The latest plunge comes as relations between Russia and the UK worsen after the probe into the death of Alexander Litvinenko.

The Russian rouble has hit a new all-time low against the US dollar amid the slide in the oil price on world markets.

It was trading at more than 85 to the dollar on Thursday, a fall of 3% after it had reached a previous record level of 82.4 the day before.

The currency is at its lowest level in its current form but President Vladimir Putin’s spokesman said the situation was not critical and that Mr Putin had no plans for emergency meetings.

Dmitry Peskov told Russian news agencies: “I wouldn’t use the word ‘collapse’. The rate is really changing, the rates is volatile, but it’s far from a collapse.”

The slump came as frosty relations between Russia and the UK worsened after an inquiry found that the fatal poisoning of Russian dissident Alexander Litvinenko in 2006 was probably approved by Mr Putin. Moscow condemned the report as biased and politically motivated.

But the wider issue that has been weighing on Russia’s economy and currency up to now is the slump in oil prices.

Brent crude is trading at its lowest levels since November 2003, with a barrel of oil costing less than $28, down by about three quarters since it topped $115 in the summer of 2014.

It is a severe blow to Russia’s oil dependent economy. The latest fall in the rouble comes after the lifting of international sanctions against Iran, increasing the supply of oil on global markets at the time when there is already more than enough to meet slowing demand.

The International Monetary Fund this week predicted that Russia’s economy will shrink by 1% in 2016 following a fall of 3.7% in 2015, before returning to 1% growth next year.






Source: Sky News

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