The rouble has staged a lightening-fast recovery to levels last reached in the days before Russia invaded Ukraine, defying predictions that the war would launch it into freefall.
US Secretary of State Antony Blinken said the ruble’s rebound is fueled by “a lot of manipulation” by Russian authorities and won’t be sustainable.
Russia’s central bank has imposed severe capital controls to help counter financial sanctions by the U.S. and its allies and the impact of an exodus of western companies after President Vladimir Putin’s invasion of Ukraine.
Russia’s economy, however, is on track to see $321 billion in energy exports this year, Bloomberg reported Friday, if oil and gas continues to flow. That estimate from Bloomberg Economics would be an increase of more than a third from 2021, providing an economic lifeline.
“At the same time, the impact of sanctions has caused domestic demand and imports to weaken sharply,” Jackson said. “So Russia’s trade and current account surpluses are probably increasing dramatically, creating demand for rubles.” As long as energy prices stay high—and as long as Russia keeps most of its oil and gas customers—the ruble will likely continue to be pushed upwards, Jackson said.
