Russian Rouble Plummets Amid Escalating Ukraine Conflict

The Russian rouble weakened significantly against the dollar after Ukraine launched its biggest incursion into Russian territory since the war began in 2022. Over consecutive sessions, the rouble lost 6% of its value. Western sanctions on the Moscow Exchange shifted currency trading to opaque OTC markets, further complicating the situation.

The Russian rouble weakened further against the dollar on Monday as Russia evacuated parts of a second region adjoining Ukraine, six days after Kyiv launched its biggest incursion into Russian territory since the start of the war in 2022. By 0815 GMT, the rouble was 2.2% weaker on the day at 90.00 to the dollar, according to LSEG data. The Russian currency has weakened in five consecutive sessions since the start of the attack, losing 6% of its value against the dollar.

Trading in major currencies shifted to the over-the-counter (OTC) market, obscuring pricing data, after Western sanctions on the Moscow Exchange and its clearing agent, the National Clearing Centre, were introduced on July 12. One-day rouble-dollar futures, which trade on the Moscow Exchange and serve as guidance for the OTC market rates, were down 0.3% at 87.38.

The central bank's official exchange rate, which it calculates using the OTC data, was set at 87.99 on Monday, about 4% weaker since the start of the attack. According to an analysis of the OTC market, the rouble was flat at 11.86 against the Chinese yuan, which has become the most traded foreign currency in Moscow.

It was down 2.0% at 98.67 against the euro. Brent crude oil, a global benchmark for Russia's main export, was up 0.8% at $80.31 a barrel as U.S. recession fears eased.

(With inputs from agencies.)