Nearly 2 months into the Russian-Ukraine war, the Kremlin has taken extraordinary steps to blunt an economic counteroffensive from the West.
than Britain and the U.S., which have banned or are phasing out Russian oil. In the meantime, Russia gets $850 million a day from Europe for its oil and gas.
But Russians have noticed a spike in prices. Residents of one Moscow suburb said 19-liter jugs of drinking water they regularly order have become nearly 35% more expensive than before. In supermarkets and stores in their area, the price for 1 kilogram of sugar has grown by 77%; some vegetables cost 30% to 50% more.
The Kremlin and its allies on social media have repeatedly pointed to the recovery of Russia’s ruble as a sign that Western sanctions aren’t working. The ruble crashed to around 150 to the dollar in the early days of the war but recovered to around 80 to the dollar, about where it was before the invasion. A gauge ofby Rosstat has shown inflation slowing, but that is not surprising after the central bank raised interest rates as quickly as it did.
This isn’t the first time Russia has thrown its full force behind defending the ruble’s value as a symbol of resistance against the West. Throughout the 1970s and ’80s, the Soviet Union had an official exchange rate of one ruble equaling about $1.35, whereas the black-market exchange rate was closer to four rubles to the dollar. The Russian debt crisis of the late 1990s also was caused partially by the Kremlin’s active defense of the currency’s value.
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