The Russian ruble has undergone an astonishing recovery, surging to levels not seen in almost two years, after losing over half of its value in March owing to Western sanctions. Sergey Kopylov, a junior partner at consultancy firm BSC and a lead researcher at Plekhanov Russian University of Economics, unravels the mystery of the rising ruble.
According to the researcher, when the assets of Russia's central bank were frozen, the West had failed on its obligations to the country. "This is the abolition (something like cancel culture) of the rules of international financial relations based on global total return swaps, redistribution of risk, guarantees of property rights and distribution of seigniorage."
The old ruble exchange rate and the approaches to its establishment that we are familiar to were established by these rules, according to the expert, who added that those rules "no longer apply."
The ruble is gaining because it is now solely based on exports and imports, an...
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