Russia’s Ruble Hits a 17-Month Low

The Russian currency, the ruble, has lost nearly 40% of its value this year, further weakened by the drop in exports, combined with a jump in imports driven by strong domestic demand. Maxim Oreshkin, an economic adviser to Russian President Putin, blamed the central bank for the currency’s depreciation.—cnn.com

Answer the following questions to check your understanding of the story.

1) What is the effect of a decrease in Russian exports and an increase in Russian imports in the foreign exchange market?

A decrease in Russian exports ____________, and an increase in Russian imports ____________.

a) increases the supply of rubles; decreases the demand for rubles

b) decreases the demand for rubles; decreases the demand for rubles further

c) decreases the demand for rubles; increases the supply of rubles

d) increases the supply of rubles; increases the supply of rubles further

2) The graph shows Russia’s interest rate. What does Maxim Oreshkin mean about the actions of the central bank contributing toward the ruble’s depreciation?

Maxim Oreshkin means that the Russian central bank has ______________ to prevent the ruble from falling.

a) lowered the interest rate by too little and too late

b) raised the interest rate by too little and too late

c) raised the interest rate by too much

d) not lowered the interest rate by enough

Russia’s Ruble Hits a 17-Month Low

Like this:

Leave a ReplyCancel reply

Share this:

Like this:

Leave a ReplyCancel reply

Discover more from Econ Eye