The Russian currency dropped to the lowest level since November last year
Russian ruble on Monday showed the sharpest daily decline in two years, while the shares of the largest Russian companies also came down amid a new round of sanctions by the USA against Russian oligarchs.
Announced on Friday the sanctions are directed against officials and businessmen close to Russian President Vladimir Putin, and represent a strong response to Russian intervention in elections in 2016.
New sanctions could jeopardize the recovery of the Russian economy, which only recently began to strengthen after the first major wave of sanctions imposed in response to the annexation of Crimea in 2014.
The Russian currency dropped to the lowest level since November last year and made 60,24 of the ruble to the dollar. This is the largest one-day drop since January of 2016.
Meanwhile, the securities market observed fall: of one share of the company of aluminum magnate Oleg Deripaska diminished at twice the price, the stock lost another 34 percent after he got to the sanctions list.
Dollar-denominated RTS index lost more than 11 percent and the ruble-denominated index Masuri – more than 9 percent. These are minimum figures since September and November respectively.
Press Secretary of Russian President Dmitry Peskov said that Moscow is closely following the developments in the market, however, to assess the impact of sanctions, will take time.
Because of the sanctions, Russian companies can lose access to the American market, according to analysts at Promsvyazbank, last year accounted for 14 percent of the income of the company “RUSAL”.
Russian Prime Minister Dmitry Medvedev on Monday instructed the government to prepare measures to support Russian companies, targeted by sanctions, as well as possible responses.
Losses and companies not on the sanctions list. Thus, the metallurgical company “Evraz” on Monday, lost 8 percent and the dollar-denominated bonds of the gold mining company “pole” reached a record low.
Russian government dollar-denominated bonds also showed a decrease: the price of Eurobonds maturing in September 2043 reached its lowest level in five days.