Breaking: Bank Of Russia Raises Key Interest Rate To 20 Per Cent, Highest Since 2003

Russia Ukraine News: Along with the rate hike, the bank also imposed capital controls to protect the economy.Western countries including the USA have imposed a vast number of financial sanctions on Russia as a punishment for its aggression on Ukraine.

Russia Ukraine News: In a blow to markets in Russia, the country’s central bank Bank of Russia on Monday increased the key interest rate from 9.5 per cent to 20 per cent, according to Bloomberg. This is the highest interest rate in the country since 2003. Along with the rate hike, the bank also imposed capital controls to protect the economy.

Western countries including the USA have imposed a vast number of financial sanctions on Russia as a punishment for its aggression on Ukraine. According to media reports, the country has also been removed from the international payments system SWIFT.

After the sanctions, the Russian currency, Ruble, plunged 30 per cent to 118 per dollar. It was just around 80 a few days ago. The Russian share markets too have shrunk considerably since the Russia Ukraine War began.

On Monday too, the central bank of Russia banned the sale of securities held by foreigners, according to Bloomberg. However, the bank has not specified which securities have been banned.

It is estimated that the sanctions on Russia may dent the economy by up to $640 billion.

According to the report, the restriction on the securities will only apply to Moscow Stock Exchange and not to other exchanges worldwide. The latest sanctions are imposed to impact Russia’s economy substantially, choking the already struggling economy the report added.

Credit rating agencies including S&P have downgraded the country’s rating due to rising sanctions and exclusion from the SWIFT system. According to a statement on Moscow Stock Exchange’s (MOEX) website, the markets may not open for trading. Even if they do, they will open at 3 PM (RST).