Russia’s ruble is rebounding — and some security officials want to ‘escalate’ sanctions: report
After Russian forces, on orders from President Vladimir Putin, launched a full-fledged invasion of Ukraine on February 24, the Biden Administration and its European allies in the North Atlantic Treaty Organization (NATO) responded with tough economic sanctions — and the value of the ruble plummeted. But on Wednesday, March 30, Politico’s Kate Davidson reports, the ruble had “staged a dramatic recovery” and “was nearly back to its pre-war level.”
Davidson, in a Politico article published on March 31, asks economists and security experts to respond to this development. Some of them, Davidson reports, “say the ruble’s rebound doesn’t necessarily mean the West’s economic weapons are losing their punch.” But others argued that the Biden Administration and NATO need to make the sanctions even tougher by going after Russian oil more aggressively.
As a result of our unprecedented sanctions, the ruble was almost immediately reduced to rubble.\n \nThe Russian economy is on track to be cut in half.\n \nIt was ranked the 11th biggest economy in the world before this invasion \u2014 and soon, it will not even rank among the top 20.— President Biden (@President Biden) 1648332658
Biden told Zelenskyy that the U.S. plans to send Ukraine another $500 million in \u201cdirect budgetary aid,\u201d according to a White House readout of their phone call Wednesdayhttps://www.politico.com/news/2022/03/30/biden-additional-aid-ukraine-zelenskyy-00021700\u00a0\u2026— POLITICO (@POLITICO) 1648663006
Rachel Ziemba of the Center for a New American Security told Politico, “The strength in the ruble is reinforcing the argument for those who think that we need to take greater steps on the energy side. It’s definitely increasing that political pressure.”
Daniel Glaser, who served in the U.S. Treasury Department under President Barack Obama, argues that anti-Russia sanctions need to be ramped up.
The former Obama official told Politico, “It’s very hard to keep sanctions the same because the target will do things to adjust. So, I do think it’s important to keep the pressure on, and I think keeping the pressure on means increasing sanctions.”
Another former Obama official, Edward Fishman —who served in the U.S. State Department — believes that although the Biden/NATO sanctions against Russia have been effective, it’s time to “escalate” them.
Fishman told Politico, “The U.S. and Europe, I do believe, deserve a lot of credit for the solidarity and resolve they’ve shown on sanctions. The sanctions are clearly impacting Russia’s economy dramatically. However, I think that we’ve stalled out a bit. There’s a lot of room for escalation.”
A Treasury Department official, quoted anonymously, believes that the Russian Central Bank is artificially inflating the value of the ruble by taking dramatic steps like barring commercial banks in Russian from selling U.S. dollars to customers.
The official, presumably interviewed on condition of anonymity, told Politico, “The retracement that we’ve seen from its historic weakness is really coming from these extreme policy decisions that have been made by the central bank. We don’t view this as demonstrating any kind of strength in Russia’s economic outlook.”
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