The Russian ruble crashed approximately 4.2% vs. the dollar on Monday. This is the largest one-day drop since January of 2016, when the ruble hit all-time lows against the dollar at 85.9493.
Monday’s sell-off was largely driven by the fresh sanctions imposed on seven Russian oligarchs and seventeen officials close to President Putin, which were announced last Friday in response to the supposed Russian interference in the U.S. elections, in 2016.
In addition to the currency fall, shares of major Russian firms also lost value during Monday’s trading session, as investors began to digest the knock-on effects of the new sanctions on the Russian economy.
Russia’s RTS Index closed on Monday with a whopping loss of 11.44%. At the height of the sell-off, the RTS was down more than 12%.
The new sanctions could put in jeopardy Russia's fragile currency, which has been fairly stable since April of 2017, trading between 56-60 rubles to the dollar.
The Russian ruble took on big losses between 2014 and 2016 - falling from 33 rubles/dollar in June of 2014, all the way down to 85 rubles/dollar by Jan. of 2016 - as the first wave of sanctions against Russia were unveiled as a response to the Crimean annexation of 2014.
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