Enacting gold parity was standard practice by the world’s major powers for facilitating international trade payments in the era of the gold standard in the 19th and early 20th centuries.
The same was established slightly during the Bretton Woods era from 1944 until 1971 when then-US president Richard Nixon determined to end the system by removing the link between gold and the US dollar.
Putin’s new arrangement originally is envisaged from March 28 to June 30. It is the latest in a series of ruble-related moves by the Russians, beginning with the announcement on March 23 that they would only accept roubles for European gas instead of euros and US dollars.
Making ruble more desired
Putin’s new arrangement originally is envisaged from March 28 to June 30. It is the latest in a series of ruble-related moves by the Russians, beginning with the announcement on March 23 that they would only accept roubles for European gas somewhat of euros and US dollars.
It was predicted that Russia would at least extend this policy to oil. Nevertheless, it has gone further and signaled an intention to apply it to all the commodities it exports (including wheat, nickel, aluminum, enriched uranium, and neon).
The primary goal of these moves is to provide the ruble’s credibility by making it more desirable in the forex market. Nevertheless, it also fits into longstanding attempts by Russia and China to dilute the US dollar’s dominance as the global reserve currency (indicating it’s the currency in which most international goods are priced and which most central banks hold in their foreign reserves).
