Russia raises key interest rate to 17% amid rouble decline

[webfact]

Russia raises key interest rate to 17% amid rouble decline

(BBC) The Russian central bank has announced it is hiking its key interest rate to 17% from 10.5%.

The bank said the move was to try to ease the rouble's recent descent in value.

The Russian rouble has dropped to a new low against the US dollar, as falling oil prices and Western sanctions continue to weigh on the country's economy.

It snapped back to 60 roubles per dollar from a low of 67 earlier.

The 60 mark is considered a "psychological barrier" for Russia's national currency, says the BBC's Moscow correspondent, Steve Rosenberg.

Since the start of the year, the rouble has lost more than 45% of its value against the dollar.

Russia's central bank has tried unsuccessfully to stabilise the currency, buying roubles in the markets.

Full story: http://www.bbc.com/news/business-30490082


-- BBC 2014-12-16

[siampolee]

Could be an interesting time coming as we see the meltdown of the Russian Rouble.

Although not a major world currency the knock on effects could cause a few unwelcome ripples to other currencies and of course the bankers who have financed Russian projects.

Pattaya will no doubt soon be deserted as the financially ruptured Reds sail off into the sunset to the tune of ,''Red Sails in the Sunset.''

[Thunder26]

Russians witness a financial crisis worse than in 1998. Agreed with the post above that the number of Russian tourists will dwindle considerably as many of them can't afford the trip anymore.

[harryfrompattaya]

This is not going to stop in Russia another 30 per cent decline. Also the rest of the so emerging market shall drop. The Dollar shall be strong for the next fifty years. America control oil and food. Gold shall go to 350 Oz.

[ezzra]

Dose Putin care at all if the Rouble will lose 50% of it's value? of course not, he's got

his loot all in foreign currencies, he's not stupid to keep it in Roubles...

[jpinx]

Who's brave enough to buy a collapsing currency and lock in a rate of almost 20% for 5 years

[NeverSure]

Could be an interesting time coming as we see the meltdown of the Russian Rouble.

Although not a major world currency the knock on effects could cause a few unwelcome ripples to other currencies and of course the bankers who have financed Russian projects.

Pattaya will no doubt soon be deserted as the financially ruptured Reds sail off into the sunset to the tune of ,''Red Sails in the Sunset.''

Or "Reds ails in the sunset."

[stoli]

Russia is not dead, nor will it be. I look forward to about 2 years from now, (an educated guess, but still a guess), for when the ruble will find some legs and become stronger. I think at that time I will be buying rubles and just watch it come back.

The Russians are done buying any condo's in Thailand for a long time, because it simply costs them too much. They can make more getting 17% on their money in a Russian Bank. If they try to sell the condo's they do own here, they will lose about 40% of their value by selling for baht, and then changing the baht into rubles.

I am sure the developers in Thailand are very nervous on how they are going to replace all of those former Russian buyers of their condo's. I would be.

[NeverSure]

17%. That will stop an economy in its tracks. If they pay 17% they have to collect that or more from someone or go tits up.

Who in Russia will borrow money at 17%? Will anyone be dumb enough to lend Russia money at 17%?

[Major4608]

Putin will blame all the problems on those oil Fracking Americans.

[jpinx]

17%. That will stop an economy in its tracks. If they pay 17% they have to collect that or more from someone or go tits up.

Who in Russia will borrow money at 17%? Will anyone be dumb enough to lend Russia money at 17%?

Your memory is short -- USA mortgage rates were around that in the 1980's

http://www.bankrate.com/finance/mortgages/history-of-mortgage-interest-rates.aspx

[apetley]

This is not going to stop in Russia another 30 per cent decline. Also the rest of the so emerging market shall drop. The Dollar shall be strong for the next fifty years. America control oil and food. Gold shall go to 350 Oz.

Is that bht or $?

[stoli]

17%. That will stop an economy in its tracks. If they pay 17% they have to collect that or more from someone or go tits up.

Who in Russia will borrow money at 17%? Will anyone be dumb enough to lend Russia money at 17%?

Just look at 1981, when the President of the U.S. was Jimmy Carter. Mortgage rates hit 18.6%, and people were still buying homes. Sad, but true.

[rickirs]

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17%. That will stop an economy in its tracks. If they pay 17% they have to collect that or more from someone or go tits up.

Who in Russia will borrow money at 17%? Will anyone be dumb enough to lend Russia money at 17%?

The Greeks? They've been there, done that.

[jacksam]

This is not going to stop in Russia another 30 per cent decline. Also the rest of the so emerging market shall drop. The Dollar shall be strong for the next fifty years. America control oil and food. Gold shall go to 350 Oz.

Been reading tv all morning to get a laugh. Just when I give up, I stumble upon this

[rickirs]

In a year the ruble has lost almost 50% against the baht, and likely to lose another 10-20% in the near future. This will make Thailand foods too expensive to import, further limiting Thailand's market strategies as it tries to avoid financial impacts of any potential US and EU markets restrictions over human rights and democratic issues.

Russian oil becomes "cheap" compared to the baht. Good for Thailand? With current and near-future oil prices less than Russia's oil production breakeven costs, it won't be worth Russia's efforts to export oil to Thailand (or anywhere else for that matter). This is another losing situation for Thailand.

Thailand and Russian economic partnership: lose-lose

[spidermike007]

Russia is not dead, nor will it be. I look forward to about 2 years from now, (an educated guess, but still a guess), for when the ruble will find some legs and become stronger. I think at that time I will be buying rubles and just watch it come back.

The Russians are done buying any condo's in Thailand for a long time, because it simply costs them too much. They can make more getting 17% on their money in a Russian Bank. If they try to sell the condo's they do own here, they will lose about 40% of their value by selling for baht, and then changing the baht into rubles.

I am sure the developers in Thailand are very nervous on how they are going to replace all of those former Russian buyers of their condo's. I would be.

You are probably very correct, on that score. Pattaya, Samui, and Phuket are going to take a real hit from those missing Russian tourists. Last year, they were the second largest tourist group in the country, after the Chinese, from what I am told. At a price hike of nearly double, Thailand is starting to look expensive, even for the Russians. Wonder how many will miss them. Personally, I prefer the Chinese. More jovial, more fun to be around, and friendlier, in comparison.

[VegasVic]

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Who's brave enough to buy a collapsing currency and lock in a rate of almost 20% for 5 years

Only a fool Vlads days are numbered, the Rouble is basically in freefall and investors can smell the fear

[DrTuner]

The usual Russian cycle. Once they succeed in something, time to pop open that vodka and screw it up again.

[VegasVic]

<script type='text/javascript'>window.mod_pagespeed_start = Number(new Date());</script>

Russia is not dead, nor will it be. I look forward to about 2 years from now, (an educated guess, but still a guess), for when the ruble will find some legs and become stronger. I think at that time I will be buying rubles and just watch it come back.

The Russians are done buying any condo's in Thailand for a long time, because it simply costs them too much. They can make more getting 17% on their money in a Russian Bank. If they try to sell the condo's they do own here, they will lose about 40% of their value by selling for baht, and then changing the baht into rubles.

I am sure the developers in Thailand are very nervous on how they are going to replace all of those former Russian buyers of their condo's. I would be.

You are probably very correct, on that score. Pattaya, Samui, and Phuket are going to take a real hit from those missing Russian tourists. Last year, they were the second largest tourist group in the country, after the Chinese, from what I am told. At a price hike of nearly double, Thailand is starting to look expensive, even for the Russians. Wonder how many will miss them. Personally, I prefer the Chinese. More jovial, more fun to be around, and friendlier, in comparison.

Preferring the Chinese over the Russians, is that kind of like preferring syphilis over gonorrhea

[daveAustin]

Russia raises key interest rate to 17%

I wish the BoE would do the same and burst the UK's grossly inflated housing bubble to piss off the greedy politicians with second and third 'homes'.

[wabothai]

How desperate can you get? Loansharks 36% !

[zydeco]

17 percent! Putin is getting into Jimmy Carter territory.

[Mosha]

The move failed. It's still dropping

[Publicus]

Still waiting for Putin to start demanding gold for Russian oil.

Or Chinese yuan.

[theguyfromanotherforum]

it was 66 2 hours ago. It is 76 now.

This looks like a crash.

How will it affect Russian tourism in Thailand, specifically Pattaya?

[zydeco]

it was 66 2 hours ago. It is 76 now.

This looks like a crash.

How will it affect Russian tourism in Thailand, specifically Pattaya?

For the ones already here, one of two ways. First, it might sober them up and get them good and depressed. Second, it might send them on the world's biggest ever drinking binge. Aftereffects? More balcony jumps with number 1. More brawls and fistfights with number 2. If number 2, watch out for the 7-11s.

[Morch]

Them BRICS falling apart?

[hawker9000]

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Who's brave enough to buy a collapsing currency and lock in a rate of almost 20% for 5 years

Only a fool Vlads days are numbered, the Rouble is basically in freefall and investors can smell the fear

Exactly. The blood's in the water. The scariest part about it is that Vlad's likely to be driven to ever more desparate measures... It's not a time for the west to be complacent vis-a-vis a starving russian bear.

[Thunder26]

Russian newspapers reporting that the exchange rate is now 80 Rubles for 1 $, and over 100 for 1 Euro. Free fall!