A civilian ship belonging to the Russian forces in the Black Sea

The value of the ruble has fallen about 25 percent against the dollar since the beginning of the year. Its decline has led to fears of rising inflation, and prompted Kremlin fans to criticize the country’s financial authorities in state news media.

wrote Maxim S. Oreshkin, Putin’s economic advisor opinion column Russia’s state news agency TASS reported on Monday that “the main source of the ruble’s weakness and acceleration of inflation is accommodative monetary policy,” and that Russia’s central bank has “all the necessary tools to normalize the situation in the near future.”

“The weak ruble complicates the restructuring of the economy and negatively affects the real income of the population,” he wrote. “A strong ruble is in the interest of the Russian economy.”

Last week, Vladimir Solovyov, a commentator on Russian television who advocates for the Kremlin, said the ruble’s depreciation was the subject of universal derision.

Russia’s central bank said Thursday, in a move to strengthen the ruble, that it will halt its purchases of foreign currency for the remainder of the year.

And Monday morning, that was followed by a statement to Interfax Saying that it “recognizes the possibility of raising the main interest rate in the upcoming meetings.” By the afternoon, after the ruble’s continued weakness, came the announcement of a Tuesday morning meeting, a month before the Bank’s next rate-setting meeting on September 15th.

Russia’s annual inflation rate was 4.3 percent in July, and the central bank predicted it could rise to 6 percent by the end of the year.

Concerns about the ruble and inflation are the latest crisis in the financial volatility unleashed by Mr Putin’s war against Ukraine. The government’s growing budget deficit also raises concerns about the sustainability of Russia’s massive war spending.

Despite these challenges, Russia’s economy grew 4.9 percent in the April-June period compared to a year earlier, the government said Friday, a better-than-expected result and the country’s first annual gain in economic growth since the start of the war. in Ukraine.

In July, the International Monetary Fund raised her expectations For Russia’s economic growth in 2023 to 1.5 percent, from 0.7 percent. In 2022, the country’s GDP will contract by 2.1%. Growth in Russia was largely driven by government spending on the war effort, which fueled inflation and widened the budget deficit.

After invading Ukraine in February 2022, Russia struggled to fill gaps in its economy caused by the onslaught of Western sanctions and the migration of capital and assets, while the ruble fell to 135 against the dollar. But a sharp rise in oil prices and a decline in imports helped the ruble recover and led to a record trade surplus of $221 billion in 2022.

This year, the surplus has shrunk and oil revenues have plummeted due to Western embargoes and price caps.

Oleg Matsnev Contribute to the preparation of reports.