MARKETS

Russia’s Stock Market Stays Closed, Foreign Currency Sales Stopped

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  • The Moscow stock exchange will stay shut Wednesday, Russia’s central bank said, bringing the closure well into the second week.
  • The central bank also halted sales of foreign currency, as tough sanctions threaten to crush Russia’s economy.
  • The Russian ruble is trading at less than 1 cent, and the country’s stocks are seen as “uninvestable”.

Moscow’s stock exchange remained shuttered Wednesday, extending its closure well into a second week, as escalating sanctions against Russia threatened to hobble the country’s economy.

Russia’s central bank has opened trading on its currency market, even as it separately stopped the sale of foreign currencies.

The Bank of Russia said in a statement that foreign currency sales to customers would be halted from Wednesday until September 9. Banks may not make any foreign-currency sales to customers, but customers can exchange foreign currencies to ruble.

The Russian currency, the ruble, has plunged to historic lows. It was trading at less than 1 cent to the US dollar, at $0.0085 on Wednesday, and is down by over 35% year to date.

Strategists have said Russia was becoming increasingly “uninvestable”as huge amounts of its assets are frozen, and global financial institutions and companies scramble to cut ties with the country.

Russia’s stock exchange was shut on February 28 in an attempt to stem sharp price declines driven by tough sanctions. The day Russia attacked Ukraine, its MOEX stock market plummeted around 50%, losing $259 trillion in market value.

Examples of the tough penalties put in place by the West include freezing $630 billion of Russian Central Bank assets and blocking some Russian banks from the SWIFT payments system. These sanctions are seen as aimed at isolating the country from the financial system.

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