FX.co ★ Russian Ruble Holds Around 2-Year Highs

The Russian ruble has been trading around 79.4 per USD, maintaining levels near its two-year highs, with a substantial gain of approximately 30% in value this year. This appreciation has been underpinned by capital controls, stringent monetary policies, and a general weakness of the dollar. A significant factor behind this trend has been the conversion of foreign earnings by Russian exporters, notably in the oil industry. These exporters, under government mandate, are required to repatriate a portion of their foreign currency earnings and convert them into rubles within the domestic market. Additional measures to control capital, instituted following the Ukraine invasion, have further supported the ruble. These measures include restrictions affecting foreign companies. At the same time, talks about potential peace negotiations with Ukraine have provided some support to the currency, despite there being no significant agreements achieved. In terms of monetary policy, it is notable that the Central Bank of Russia lowered its benchmark interest rate by 100 basis points, bringing it to 20% during its June 2025 meeting. This marks the first rate reduction in nearly three years and is attributed to a decrease in inflation and indications of economic sluggishness.