12 months ago
Rouble Weakens After Sberbank Predicts Year-End Decline
The Russian rouble, the country's currency, lost some value against the U.S. dollar and China's yuan.
This happened because the head of Russia's largest bank, Sberbank, said the rouble is likely to get weaker by the end of the year.
He thinks this will happen because the central bank might lower interest rates, which are like fees for borrowing money.
The central bank had raised these rates to fight inflation, but they have been lowered a bit recently.
Sberbank's CEO believes further rate cuts will cause the rouble to weaken, which could help exporters and the government's budget.
The central bank will decide on the interest rate again on September 12.
The Russian rouble fell against the U.S. dollar on Thursday.
The rouble hit its lowest level since July 31.
Sberbank's CEO predicted the currency will weaken by year-end.
The central bank may cut interest rates.
The next central bank meeting to decide on rates is September 12.
- Who
- The Russian rouble
- What
- Weakened against the U.S. dollar and China's yuan.
- Where
- Vladivostok, Russia
- When
- September 4
- Why
- Due to the potential for central bank rate cuts, as predicted by Sberbank CEO German Gref.
Key facts
- Rouble's Weakening
- 0.4% against USD; 0.5% against Yuan
- Date
- Thursday, September 4
- Sberbank CEO
- German Gref
- Central Bank Meeting
- September 12
- Key Rate
- Currently 18%; Gref expects 14% by year-end
Quotes
German Gref
CEO of Sberbank
“According to our estimates, the exchange rate should weaken by the end of the year, which will reduce risks for exporters and the budget.”
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“If there is a reduction in rates, then I think there will be a gradual decrease in the exchange rate.”
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