On Monday, the Russian ruble dropped almost 30% against the U.S. dollar, dropping to as low as 119 versus the dollar, as stated by Reuters.
The plunge arrived behind the European Commission said on Saturday that Western partners would slap restrictive measures on the Russian Central Bank’s international reserves worth $630 billion.
Western countries have strengthened their economic isolation of Russia, including the reduction of selected banks from the SWIFT banking system.
As stated by Bloomberg, the moves have alarmed many Russians, who are withdrawing U.S. dollars at more additional than a 30% premium over the market’s close on Friday.
The ruble is possible to continue coming under pressure
Russians also worry their bank cards may stop functioning and that banks might restrict cash withdrawals, Reuters reported.
Russia’s central bank is shouting for calm, expressing in a Sunday statement it has the necessary resources and means to support financial stability and ensure the operational continuity of the financial sector.
In a press release on Friday, Central state-owned Russian bank Sberbank stated that it was operating as usual. Customers would continue to access their funds and exchange them into foreign currencies.
Nevertheless, the European Central Bank said that Sberbank Europe, a wholly-owned subsidiary of Sberbank Russia, is “failing or likely to fail” alongside its Croatian and Slovenian units because of significant deposit outflows. This directed to a deterioration of its liquidity position. The ECB expressed in the statement.
Sberbank did not directly respond to Insider’s request for comment.
