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Russia Shocks With Emergency Rate Hike, Boosts Interest Rate From 10.5% To 17%
Following the biggest rout to the Ruble in ages, Russia - unlike Mario Draghi - instead of talking the talk decided to walk the bazooka walk and shocked all those long the USDRUB by unleashing an emergency rate hike (at 1 am in the morning) from the recently raised interest rate of 10.50% to... hold on to your hats... 17.00%, a 650 bps increase!
From the press release:
The Board of Directors of the Bank of Russia has decided to increase from December 16, 2014 the key rate to 17.00% per annum. This decision was driven by the need to limit significantly increased in recent devaluation and inflation risks.
In order to enhance the effectiveness of interest rate policy loans secured by non-marketable assets or guarantees for a period of 2 to 549 days from 16 December 2014 will be granted at a floating interest rate established at the level of the key rate of the Bank of Russia increased by 1.75 percentage points (Previously these loans for a period of 2 to 90 days, provided at a fixed rate).
In addition, to enhance the capacity of credit institutions to manage their own currency liquidity was decided to increase the maximum amount of funds to repurchase auctions in foreign currency for a period of 28 days from 1.5 to 5.0 billion. US dollars, as well as on similar operations for a period of 12 months on a weekly basis.
And for the Russian-speakers, the full breakdown of rates.
Few markets are open but the 1month forward Ruble market just dropped (Ruble rallied) over 2.5 handles...
RSX (ETF) is starting to rally after-hours...
Chart: Bloomberg
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There’s one thing I am missing here: if this entire oil price collapse has been pre-planned and is being rolled out to hurt Russia, then what prevents TPTB from rolling out an attack on RUB as well? I mean, we keep saying that unlimited paper is being used to manipulate gold prices down, so why stop with gold? Why not keep selling USDRUB futures thus pressing the ruble down? And then the only real defense against this attack would be closing fx exchange trading for the ruble.
The attack on the oil price is an attack on Russia, hence an attack on the Ruble.
In Russia, you don't talk about it. You just do it and the country wins. In America, you leak to insiders the rate hike and get the president to lie to the public on TeeVee to get more suckers on the opposite side of the trade. Don't let a screw job go to waste. If you like your ZIRP, you can keep your ZIRP. Some folks lost their savings. Invest in penny stocks and become a billionnaire like high school kid Mohammad. It is a Bulltard market. So much cash on the sidelines and the green shoots are sprouting. Don't save. Buy stocks. Gold is a barbaric relic which is in a bubble since prehistoric times. Blah Blah.
Since Putin's announcement, the ruble has fallen further to over 58 or 61 rubles to the dollar. (2 different apps) 17% in the middle of the night sounds almost desperate. Investors would like to know what Putin knows about the near future? Wow..... The rubble is now 72.4 to the dollar since yesterday afternoon. Brutal.
Hey Putin. Is that you downvoting me?
If the dollar is flying, it must be the perfect time for the Chinese to unload their horde of them.
Sell the dollar at it's highest
Buy the ruble at it's lowest.
China's Wet Dream.
(and Amerikan Patriot's wet bed)
AP
Big Vlad
Big Bad Vlad.
Invest in Rubles. It doesnt fall out of helicopters.
Invest in Dollars. It will never die.
Russia has sovereign wealth funds they are safe, http://www.swfinstitute.org/fund-rankings/
They can tap it any time!!!!
Russia has sovereign wealth funds they are safe, http://www.swfinstitute.org/fund-rankings/
They can tap it any time!!!!
russia total debt is $700+ bln the reserves are standing at what ? $450 bln ?
corporations could not get local funding in RUB so they borrowed alot in USD now we see the result
and now russian CB increasing interest rates to suck out the last blood from corporations? uahahaha give me a break. bankers at their best - sucking out real economy...
More than 3% of Russian mortgages are in borrowed USD... try paying that monthly payment when your Ruble is cut in half.
Eventually, that 3% of mortgage borrowers, the people who were crashed out of the Russian stock market earlier this year, and that small percentage of Russians that still like to eat affordable bread will all get together for a meeting in the streets.
When they do, they won't be chanting against "The Great Satan", they will be chanting against PUTIN.
I see that the rise in Interest rates has really helped the Rouble
...........for a couple of hours anyway !
"I'm givin her all she's got Putin" and
"She canna take anymore Putin, she's gonna blow !"
http://www.investing.com/currencies/usd-rub
77 rubles to the dollar ! Fuck me sideways
Respected former finance minister Alexei Kudrin approved the move, saying on Twitter that "in current conditions (it was) compulsory but correct."
But he said the Russian government should now adopt measures to help win back the trust of investors.
Alfa Bank struck a similar note.
"While the Russian central bank may have addressed capital control fears with such an aggressive move, the main issue here would be winning back the population’s confidence, as it has been converting savings into dollars at a faster pace," said the bank.
http://www.bangkokpost.com/news/world/450207/ruble-plumbs-new-low-despit...
So why does russians convert their money to hated western dollars? Huh? Anyone? Why do they harm their own economy? Anyone? Why Russians doesn't trust their money, their economy? Doesn't they trust their goverment also?
Why russians loves US dollars so much?
I can see the headline now. "RUSSIAN TANKS SEEN ENTERING UKRAINE" (For the umpteenth time)
Here is what Russia has to do, PRONTO, if it wants to remain in one piece by this time next year:
- GTFO Crimea and Eastern Ukraine
- Impeach Putin for violating the Russian Constitution (sending troops to Ukraine in August without permission will do)
- Jail their top propaganda guys (just find a couple of dozen scapegoats to appease the public)
- Announce new elections (well, an interim military government will do, too, BUT you have to keep the current nutjob of a Defence Minister out of it).
- Apologize for its actions, start talking about making mends with the world.
The interest rate is irrelevant now, because there is no confidence in the market.
You forgot that Putin regime is in full control over media in Russia and now internet censorship is also up and running (add to that up paid internet trolls). So people in russia - majority of them - are unaware what's happening and why. They simply doesn't have access to free information. Putin regime controls information and that means people minds & hearts. I don't think they are capable to break free from Putin regime popoganda spell.
Valid point, but this is not the first time the Russians would have to be disillusioned about their tsar :)
It absolutely amazes the learned observer in seeing these evil things from the zionutzyville hasbara here pretending to be something more than a pile of shit and doing all they can to spread their hate to instigate hard feelings between the Russian Folks, and the American People.
Typical dog-yard poop and ancient methodologies that are as outdated as the silly idiots here who waste not only their time and energy in this instigation of moar war for zionuttyness and the wickedness of profiting from war, chaos, and destruction, but also that of the fine contributors here. It is hard to fight a coward that hides behind the rothchild skirts teasing and taunting knowing daddy will defend them to the death. At this time in history it is a race to see who takes these asswipes out first. The defenders of righteousness, or their own master slavers that have given the world a pile of shat, and made everyone believe it smells like roses.
Hey arseholes, your day is coming. We are tracing and tracking your whereabouts and will expose you soon as the sewer rats and scum-lords you all are.
NOW HEAR THIS!
Everything under the sun has been co-opted by the rothchilian empire of dust. There is NO ONE else that is responsible for the things that are happening in the world of warcraft today. Here is a long list of the puppets in places like the cfr, bild, tri-lats, and positions of governmental power. The saudis, europe, england, and the usa are all owned by the progenitors and probagators of the money-god. Everything happens according to the long aged world domination plans of the money-god creators. Stop wasting time pointing fingers at the ZONK (zionutz of nonessential KooKooville) puppets and paid off butt licking mercenaries of the overlord masters. Or in other words, stop whacking at the branches and go for the roots of all evil itself.
Every sane person in EVERY NATION should stand up to the plate as one family, and tear these evil satanic/luciferian roots right out of the earthly ground they have infested for centuries too long. Not yesterday, but RIGHT NOW before they kill off every soul on earth. It's a race and who is winning it now? The money-god, and it's slave exchangers. Surly, there are many here with vast multitudes of Light/knowledge to share about how to end the support and patronage of these evil things that profit from death, and destruction?
Is the worldwide-brotherhood of Man going to continue to be the “useless idiots” for these assklowns, by continuing in the supporting and holding up the idols and banners of evil, or will they all unite WORLD-WIDE and just say, no moar! Enuff of the kow-towing to the destruction and death they have planed for everyone. Who lives, to pay for their own slow death? Not a single slave will escape the final solution if they are continually supported, financed, ignored as the world threat they are, and allowed to do it to the world's Peoples...one day at a time.
Mandate: Sir Tyler, you kicked so many of us off this site for speaking our truth about these evil things when they bitched and cried at you. How about cleaning them out of ZH so the rest of the good world folks here can share their truth without the distractions of these evil wicked horrid nasty money-god freak tribal slave shit flies.
https://www.youtube.com/watch?v=k5JkHBC5lDs