The Swiss National Bank has switched to a negative deposit rate for some deposits, as it seeks to avoid excessive growth of the national currency. The ruble crisis and unrest in global financial markets have fuelled demand for the Swiss franc.
The Russian currency remains volatile Wednesday after it suffered its own ‘Black Tuesday’ losing about 20 percent. The ruble strengthened to 61 rubles per 1 USD, before settling near 62 at market close in Moscow.
For the sake of the Russian economy, the Central Bank cannot continue its waiting game strategy for too long hoping that speculators give up before it does, says Mike Ingram, a market strategist at BGC Brokers in London.
The current ruble exchange rate does not correspond to the macroeconomic situation, Russia’s Economic Development Minister Aleksey Ulyukaev said, adding that market players now need a new set of guidelines.
Chancellor George Osborne has welcomed the global fall in oil prices, calling the drop a “net positive” in providing UK consumers with cheaper sources of energy, while applying political pressure on Russian President Vladimir Putin.
The plunging ruble is a signal for the Russian economy to adapt to new conditions, Russia’s Central Bank Chair Elvira Nabiullina said, following the surprise midnight decision to hike the key interest rate to 17 percent.