The ruble has plunged to its lowest level against the dollar since war in Ukraine began as Putin's economy sputters

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The ruble has plunged to its lowest level against the dollar since war in Ukraine began as Putin's economy sputters
REUTERS/Ueslei Marcelino
  • Russia's currency in recent days has plunged to its lowest level against the greenback since the war in Ukraine began.
  • The ruble traded around 96 against the US dollar on Tuesday, a 30% decline from January.
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Russia's currency just plunged to its lowest level against the dollar since the beginning of its war in Ukraine — another sign that the nation's economy is sputtering as the conflict drags on and its economy is burdened with Western sanctions.

The ruble has traded around 96 against the dollar since last Friday. It's the cheapest Russia's currency has been since Putin began his invasion of Ukraine in February last year, which caused the ruble to briefly plummet to 120 against the dollar.

The ruble is one of the worst-performing global currencies of the year, and has declined around 30% from levels in January, when it traded around 65 to the dollar. In July, the currency blew past a key comfort level for the Kremlin, signaling the market's concern for Russia after the Wagner group staged a short-lived coup against President Vladimir Putin.

Economists have been sounding the alarms for Russia's economy for the past year, as the nation has been slammed by sanctions and soaring military spending. Restrictions on oil and natural gas trade led Russia's energy revenue to tumble 45% in first three months of the year. Meanwhile, government spending surged 34%, leading Russia to post a $29 billion budget deficit over the first quarter– a 107% decline from last year's $14 billion budget surplus.

Russian officials have put up a show of defiance amid war and sanctions, and Putin has claimed Russia's economy could actually grow this year with GDP surpassing 2%. But those estimates are largely drawn from "cherry-picked" economic figures, according to Yale researchers, who say that under-the-radar statistics paint a far bleaker picture of Russia's economy.

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