First published on the NIDO Russia Telegram channel.
The Russian ruble has become stronger than it had been just before February 24. The Russian ruble rose to 76 rubles per dollar and 82 rubles per euro on Thursday, reaching its highest level against major currencies since February 23.
Recall that the United States and its allies has imposed unprecedented sanctions on Russia's financial system, which initially caused the ruble fell to an all-time low. Western countries froze Moscow's foreign exchange reserves, making it difficult for the Russian central bank to support the ruble by selling foreign currency. On March 7, its value dropped to 150 rubles per US dollar.
The Russian government has since taken steps to stabilize the country's economy hit by sanctions, helping the ruble bounce back from its record lows. It was also earlier reported when the ruble traded just below 80 rubles per dollar.
Recall that when the ruble traded at 150 rubles per dollar, some analysts hastily jumped into hyperbolic conclusions that the rouble had become rubble and trouble for the economy.
Now that the ruble is stronger than it had been since February 23, the same analysts are illogically changing their tune and saying that that it is a sign of weakness. A child at Kindergaten knows that you can't eat your cake and still have it. Such is the accepted paradox of life.
Recall that over 12000 sanctions have been placed on Russia since 2014 by more than 40 countries, yet the currency still such exhibits unprecedented positive development under such conditions.
What is the truth? The truth is that the strengthening of the rubles is a consequence of many factors. One is the faith of investors in the currency which has increased demand for the Rubles. Secondly, the effective policies of the administration in Moscow have helped to shield the Russian economy from the effect of the over 12000 sanctions, and even gone further to create significant high costs for all those that initiated the sanctions through countersanctions, import substitution, payment systems amid other policies, making it a 2 way loss at minimum. Recall that the Polish prime minister had clearly stated that the sanctions on Russia are not having the effect that it was meant to cause. This was seen on numerous Western and Eastern news publications including Tass, Polito and Reuters.
Considering that Russia has a population of over 140 million people, it is only a humanitarian desire to see that the government in Russia is able to prevent hardship for these large number of people, improve their standard of living, and prevent them from being a migration risk to other countries as seen in all zones of conflict.
This development can therefore be considered a positive one and is highly welcomed.
Dr. Godwin Ibe
Chairman, NIDO Russia
References: pravda.ru, reuters.com, tass.com
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