Russian Banks Raise Key Rates to 20% in Desperate Measure to Save Ruble
The country faces sanctions from the West as the war against Ukraine continues.
Feb 28, 2022 at 8:01 a.m. UTCUpdated May 11, 2023 at 4:42 p.m. UTC
:format(webp)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/PGNEIBI2G5ESPHIKRJX4WVGXTI.jpg)
BEIJING, CHINA - FEBRUARY 04: Russia's President Vladimir Putin attends the opening ceremony of the Beijing 2022 Winter Olympics at the Beijing National Stadium on Feb. 04, 2022 in Beijing, China. (Anthony Wallace/Getty Images)
/arc-photo-coindesk/arc2-prod/public/LXF2COBSKBCNHNRE3WTK2BZ7GE.png)
Russian banks have raised key rates to 20% in a bid to save the ruble as major countries cut off support to Moscow amid its invasion of Ukraine.
- The Russian central bank raised its key interest rate to 20% from 9.5% on Monday in an emergency move. Authorities told export-focused companies to sell foreign currency as the ruble tumbled to record lows.
- The ruble opened 40% lower against U.S. dollars on Monday. Russia's state-owned Sberbank is "failing or likely to fail," the European Central Bank said in a prepared statement.
- Russia has also ordered companies to sell 80% of their foreign currencies, the central bank and the finance ministry said.
- The key rate is the interest rate at which banks can borrow when they fall short of their required reserves.
- Russia’s invasion of Ukraine has resulted in tensions in Eastern Europe. Global markets slipped last week, and bitcoin plunged as much as 10% in a single day before a slight recovery over the week as the U.S. announced sanctions.
- Meanwhile, Ukraine has raised over $10 million in cryptocurrency donations on an official address to help citizens caught in the crossfire.
UPDATE (Feb. 28, 12:27 UTC): Corrects headline to say "Russian Banks fixes key rates to 20%."
:format(webp)/s3.amazonaws.com/arc-authors/coindesk/6c6bb5af-692c-4fcf-9f8b-a75d0549effd.png)
Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.