Ruble sinks to record low as sanctions bite

International rating agencies have downgraded the country’s sovereign debt, citing sanctions impact

The ruble continued its decline on Thursday, hitting record lows against major currencies, after rating agencies Fitch and Moody’s cut Russia’s sovereign debt to “junk” status due to the impact of Western sanctions.

The Russian currency was nearly 10% weaker against the US dollar at 117, and down 7% against the euro at 124 on the Moscow Exchange at 14:00 GMT.

Russia’s financial markets have been thrown into turmoil by sanctions imposed over its war with its neighbor. Since Russian troops entered Ukraine on February 24, the ruble is down close to 30% against the dollar.

The Russian central bank gave up efforts to support the domestic currency because over half the country’s reserves have been frozen by central banks abroad. Instead, it imposed a 30% commission on foreign currency purchases by individuals on exchanges in an effort to curb demand for dollars. The regulator has also ordered Russian exporters to convert 80% of their forex revenues into rubles to support the local currency, but the measures have not kept the ruble from weakening.

For more stories on economy & finance visit RT's business section