Russians queue for cash after ruble crash

The Russian invasion of Ukraine continues to leave great economic consequences for the country led by Vladimir Putin, First thing this Monday the value of the ruble plummetedthe local currency, falling more than 30%, details the BBC World.

Given this, the Central Bank of Russia doubled its interest rateraising it from 9.5% to 20%, in an attempt to contain the devaluation of its currency.

However, the Russian currency, the ruble, decreases in value and with it, the purchasing power of the currency, which would affect the savings of the Russians.

This weekend, Hundreds of people made long queues in different cities of the country to access ATMs and exchange houses, and thus be able to withdraw money in cash.

Russians are worried that their bank cards will stop working or that limits will be placed on the amount of cash they can withdraw.

Ahead of an emergency meeting between President Putin and his economic advisers on Monday, Kremlin spokesman, Dmitry PeskovHe said: “These are severe sanctions, they are problematic, but Russia has the potential to offset the damage.”

In addition, he assured that Moscow will respond with its own sanctions.

Along the same lines, the Central Bank called for calm and said that it has “the necessary resources and tools to maintain financial stability.”

sanctions against Russia

In recent days, the West has applied harsh sanctions on Russia in response to the invasion in Ukraine.

One of the strongest is removal of several Russian banks from the SWIFT network, the main international payment system. Russia relies heavily on this system for its oil and gas exports.

In addition, the United Kingdom, the United States and the European Union prohibited dealings with the Central Bank, state investment funds and the Ministry of Finance.

Russia has about US$630 billion in reservesaccumulated from high oil and gas prices.

But because much of this money is stored in foreign currencies such as the dollar, euro and sterling, in addition to gold, a Western ban on dealing with Russia’s Central Bank restricts Moscow’s access to cash.

Last week, the Russian Central Bank was forced to increase the amount of money it supplies to ATMs after demand for cash hit the highest level since March 2020.