This morning.
Via Street Register:
The Russian rouble hit a two-year-high against the euro. However, it stabilized near Monday’s close. It is a week in which tax payments support the currency. Investors are also looking forward to a rate cut Friday.
After earlier reaching 75.95 at 8:17 GMT, 0.3% had been gained by the rouble to trade at 76.190 against the euro. This was its best mark since February 2020. The rouble was 0.1% higher against the dollar at 73.2.
Oh.
Meanwhile…
European Union companies may be able to comply with Kremlin demands that they pay for Russian pipe gas in roubles, instead of dollars or euros which are part of the original contracts, without disrupting the bloc’s sanctions against Moscow for its illegal invasion of Ukraine in February.
EU mulls paying for Russian gas in roubles (Energy News Bulletin)
Shutterstock
Meanwhile Germany borrows anther €40 BILLION.
https://www.bloombergquint.com/global-economics/germany-to-borrow-extra-40-billion-euros-to-cushion-war-blow
All going swimmingly eh? They will pay in Roubles because they have no choice. It is the end of the petrodollar- but how that impacts the US remains to be seen.
They do not pay in rubles – they pay in € – Gazprom does the exchange – please stop with this falsehood – it is FALSE -the ruble isn’t a traded currency to it doesn’t matter economically where it trades i.e. try buying anything with it – its like saying there are 2 pebbles to the $ – try spending the pebbles – nothing will replace the € as the world’s reserve currency because TINA because of the Triffin paradox – China is not so quietly imploding so is working on a much less ambitious project. – Governments borrow all the time to rollover debt – it never gets repaid – its economics 101- Germany does so because it has a functioning liquidity bond market – something Russia doesn’t
Did you even bother to read the link?
https://www.energynewsbulletin.net/outlook-analysis/news/1430859/eu-mulls-paying-for-russian-gas-in-roubles
The EU have said it would be a breach of sanctions anyway it is going to be argument about semantics as diversification is ongoing at a furious rate (that’s what happens with capitalism). If the the EU manage a short short stop on Russian oil they’d be crippled (and that is coming) – as my chum Michael Every writes today (he’ll post it on ZH later) – because of a lack of storage capacity – “Russian oil flows would back up to the point where its wells would have to be capped – and restarting them would be incredibly difficult, if possible at all. That would prevent Russia from redirecting oil to Asia, while depriving it of a major slice of its export earnings. Russian oil would be taken off the map. Meanwhile, Russian gas to Asia would take years to come online on a scale (and price) to match what Europe buys now” – this is also the issue of servicing the oil wells – the spare parts are unavailable and the specialized oil services companies have gone home – globalization works both ways and Russia became relatively more dependent on it than anyone else on its workings
As I’ve said before Putin is setting his country back at least a generation and Russia will continue be a pariah state until he is deposed or killed.
It’s laughable
The sanctions on Russia have been devistating for every family in Europe and the west except the rich who are increasing their wealth
The scale of price gouging is being made worse by government
Maybe it’s the tactic of government just make your people suffer then they get on boar with the narrative
And March off to war insenced by the russians
A tax on the money coming back from the oligarchs.. CB rate is 17%. It will drop once the big cash is back.
Um, isn’t Russia using all the dollars and euros it’s getting for gas and oil to prop up the rouble, keeping its market value high while effectively rendering it useless as a currency, essentially a humongously expensive PR exercise? If foreign countries start using roubles to buy oil and gas, can they use roubles to keep buyung roubles?
I think it’s using any foreign cash to pay for any debts that fall due. The rouble appears to be sustained by their oil and gas revenue. Bit of a juggling act but it seems to be paying off somewhat and insulating them from the worst effects of the sanctions. It’s looking like these sanctions are biting harder in the economies of the country’s imposing the sanctions for now.
Market manipulation is insulating the value of the currency – how well it’s insulating actual Russians is unclear.
The roubles value is mostly due to low volume of trade now, Russia isnt using most of the dollars and euros at all – sanctions mean most of their dollar and euro holdings cannot be used, which is why they want roubles to be used instead. A strong rouble can be used for imports from other countries like China/India
Who could possibly want anything to do with a currency that is being propped up like that?
All fiat currencies are “propped up” like that.
The US dollars value is all derived from oil sales which in turn create demand for USD.
The Yuan is very badly manipulated also to keep chinese exports competitive with the world.
Euro has similar effects, QE and the diverse nature of eurozone economies means that the currency is quite weak/cheap for the likes of Germany and France (good for exports) but bad for weaker economies, PIGS etc
the $’s value is determine by capital flows which are a function relative real interest rate differentials -it has NOTHING to do with oil sales – that’s why the Yen is so weak at the moment and the CNY as the Fed is in tightening mode and out of synch with the BoJ and the PBOC who are both scrambling around trying to ride tow horses at the same time (one domestic and one international). The CNY is having is longest losing streak since 2015 (when it devalued). Prospective reserve currencies don’t devalue ! the CNY can’t challenge the $ due to the Triffin paradox and the small issue of capital controls and the fact that it not actually a medium of exchange (try spending it outside China )
And I find it kind of funny
I find it kind of sad..
..Clown World ♫♪♪
Germany announces that it is to send heavy weapons to Ukraine, train their armed forces in Deutschland and expects to be able to announce a ban on Russian oil within days – this is the kind of dynamic that really plays havoc with totalitarian autocrats like Putin who can’t factor in that the enemy can adapt and innovate
https://twitter.com/HeleneBismarck/status/1518956866080067585