The ruble is heading for collapse, the "tipping point" is near: Russia's economy is bursting at the seams

A new problem has emerged in the Russian economy. Sanctions that are hitting it hard, plummeting revenues and capital outflows have been compounded by a record drop in the ruble against the dollar - the US currency in Russia has soared to almost 100 rubles for the first time in 16 months. However, this is not the limit - according to forecasts, the ruble will continue to fall.

Thus, as of 16:22 Kyiv time, the dollar was worth 99 rubles on the Moscow Stock Exchange. The last time this happened was 22 March 2022.

Moreover, the ruble will continue to depreciate. In particular, according to analyst Georgy Vashchenko, the psychologically important mark of 100 rubles/dollar may be reached in the near future. "I would not expect the downward trend (of the ruble - Ed.) to stop," he said.

Why the ruble has weakened

According to Bloomberg analysts, there are several reasons for the ruble's weakening. In particular:

• a significant deterioration in the terms of foreign trade;
• international sanctions, which, in fact, led to it.

Thus, they note, the revenues of large Russian exporters in July 2023 fell to $6.9 billion, down from $16.8 billion in the same period last year. This hit the Russian economy hard, as these funds are a key source of hard currency for Russia.

It is also noted that the fall in the ruble is also influenced by capital outflows. For example:

• households transferred about $40 billion to foreign banks - as interest rates in rubles did not meet inflationary expectations, "and a growing number of Russian banks were cut off from global payment systems";
• Russians' deposits in foreign banks increased by $66 billion in June-2023.

One of the worst currencies

The ruble has already weakened by 23% against the dollar in 2023 and is among the top 3 worst performing emerging market currencies. "It has been kept in good company there:

• Turkish lira;
• Argentine peso.

At the same time, analysts note that the situation will only get worse in the future. After all, there are no reasons to improve the ruble's position in the near future.

As reported by OBOZREVATEL, Russians massively bought up the Tether cryptocurrency on the day of Prigozhin's mutiny. The reasons are fear of a weakening ruble and a desire to find an alternative to it.

Only verified information is available on our Obozrevatel Telegram channel, Threads and Viber. Don't fall for fakes!