Hacker News new | ask | show | jobs
by ivan_gammel 571 days ago
How is it clear? Their foreign currency reserves decreased just by 15% since December 2021 and their total reserves actually increased. Yes, some of that huge pile of money was frozen, but it’s nowhere close to “giving up” trying. So no, you are wrong, they did not give up, they simply did not have intention to keep ruble strong. The central bank intervenes to prevent high volatility, but that’s it, since 2015 they focus only on inflation.
1 comments
dismalaf 571 days ago
It's clear based on the exchange rate. You absolutely can't trust whatever data they put out there, but you can see based on their behaviour. I mean, they're literally asking North Korea and Iran for help, trading oil and gas directly...

There's no advantage for them to have the Ruble so weak because they absolutely want to import Chinese and Western products, namely technology, to fund their war machine. Even against the Yuan, the value of the Ruble has nearly halved since June 2022. That's not good for a nation that needs to import things...

link
ivan_gammel 571 days ago
You make wrong assumptions about the exchange rate. I suggest you learn more about Russian economy, rather than speculate.

The fact is, they do not target exchange rates in their policy, only inflation. Their trade balance with China is positive (unlike USA), so yuan reserves are growing and they have no problem to buy Chinese goods. The weakness of ruble has nothing to do with it.

link
thodin 571 days ago
The exchange rate is now directly controlled by the Central bank. Trade with China is very problematic - sometimes it takes several months to complete a single transaction.
link
ivan_gammel 571 days ago
> The exchange rate is now directly controlled by the Central bank.

This is false. I don’t know where you have got this, when all information is public and easily available. Here’s how the official exchange rate us determined:

https://cbr.ru/Content/Document/File/162004/metod_6290-u.pdf

They just collect the data on OTC transactions from banks. The only way for Russian central bank to influence the exchange rate is to sell/buy and they do it only to stabilize the market when volatility is high. They do not have exchange rate targets and do not enforce specific rates in transactions.

link