JRL NEWSWATCH: “Drastic Economic Moves Highlight Russia’s Wartime Bind” – New York Times
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“With the third-largest interest rate increase in a decade to shore up the ruble, Moscow’s policymakers are pursuing the conflicting goals of paying for the war against Ukraine and taming inflation.”
“For years, Russia’s central bank … shielded the country’s economy when crisis … loomed, drastically raising interest rates, restricting money movements or taking over ailing banks. … convey[ing] a clear message that … economic stability would be maintained at any cost. On Tuesday … Nabiullina[] moved assertively again, announcing the third-largest interest rate increase in a decade to shore up … the ruble[] and dent rising inflation.
Yet, this time, her aggressive moves had little immediate effect on … markets. The central bank’s actions underlined [a] perilous moment … try[ing] to contain … seismic forces unleashed by … Putin’s invasion of Ukraine. The war has [posed] … a seemingly impossible set of tasks: maintaining economic stability while financing the war machine and coping with Western sanctions; taming inflation without pitching the economy into recession. …”