The inauguration of Dmitry Medvedev, the following appointment of Vladimir Putin for the position of Russia’s Prime Minister, Putin’s forecast of Russia’s bright future have resulted in a certain rise on the Russian stock market. The dollar quotations have grown too. The US dollar has gained 13 kopecks against the Russian ruble, which is considered quite an achievement.
Theoretically, the growth of the home stock market is supposed to support the national currency. However, the ruble dropped against the dollar, although it strengthened against the euro. What is the reason for it? The answer to this question can be found in the history of the dollar’s recent decline.
The autumn of 2007 was remembered for the slow and steady reduction of the dollar rate. It was connected with several announcements from well-known financial who warned of the imminent global crisis. The decline of the dollar was especially noticeable on the Russian market despite quite a number of official statements from Russian authorities which said that it Russia should not let the international financial crisis affect the Russian market.
The decline of the dollar accelerated in the beginning of the current year. The prices on food and fuel started to grow in Russia too, which was obviously a reflection of the world crisis on Russia’s home market. Russia elected its new president, which stipulated the continuation of the state-run policy to freeze the prices on essential goods.
Several Russian economic experts launched a series of attacks against the US currency portraying it as a symbol of the hostile US economy. They put forward a new idea to the general public in which they tried to explain the difference between the meaning of the dollar for US home market and the meaning of the dollar outside the USA.
In the meantime, Russia has completed its expansive election cycle according to the plan: Medvedev became the President, whereas Putin chaired the government. Oil prices continue to climb up.
It seems that Russian experts will continue to keep their analyses of dollar fluctuations in strict compliance with internal political events.
Translated by Dmitry Sudakov
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