The ruble is in free fall and three Russian banks in Europe are about to collapse –

The ruble is in free fall and three Russian banks in Europe are about to collapse –

The ruble depreciates against the euro and the dollar. This morning, the Russian currency lost more than 20% of its value against the euro; now worth less than a penny. The European Union’s fall in prices between the United States, United States, United Kingdom and Japan came to light after a weekend of various sanctions against Russia.

For example, several Russian banks were kicked out of Swift. It is a messaging system where banks communicate with each other internationally. It is very difficult to transfer money to foreign banks.

Support Ruble

Normally, the Russian Central Bank could have supported the exchange rate of the ruble with these foreign exchange reserves, but that is no longer possible. The European Union and its allies announced this weekend that they would freeze the foreign exchange reserves of the Russian central bank. As a result, Russia cannot access its dollars and euros deposited in many foreign banks.

The Moscow Stock Exchange said stock trading will not start this morning. The start time of the exchanges will be announced later. Currency trading will begin. Exchanges can delay trading if they expect too much turbulence to calm down.

Russia’s central bank has since raised interest rates to support the weak ruble and runaway inflation. The base rate is now 20%, doubled.

The weakened ruble will be felt especially in the wallets of ordinary Russians, as life becomes even more expensive. Everything imported from abroad, such as food, electronics, raw materials and goods, the weaker ruble and other fuels are already becoming more expensive due to high inflation. In January inflation was already 9%.

Three European banks

The European Central Bank (ECB) also warns that the three institutions supervised by the ECB will not fulfill their obligations and thus the risk of bankruptcy. They are subsidiaries of the major Russian bank Sberbank in Europe, Sberbank Europe AG in Austria and two subsidiaries in Croatia and Slovenia.

According to the ECB, there is a massive outflow of money from these Russian banks and customers are withdrawing their money en masse because of war and geopolitical tensions. As a result of this escape from the banks, it is insufficient cash in the hands of the banks and can no longer replace it with the main bank, other banks or banking center due to international financial sanctions.

These images came out yesterday; You can see how muscovites try and withdraw money en masse and worry about the future:

Source: NOS