Ruble Tumbles as U.S. Sets Out New Sanctions on Russia


Ruble Tumbles as U.S. Sets Out New Sanctions on RussiaMOSCOW — Russia’s currency, the ruble, fell on Thursday to its lowest dollar value in nearly two years, after the United States announced new sanctions against the country in response to a nerve-agent attack on a former Russian spy in Britain.

Market turmoil began on Wednesday, after a Russian newspaper published the text of a bill in the United States Congress to punish Russia for election meddling, and accelerated with the announcement of the separate chemical weapons sanctions.

It was a clear sign that sanctions were affecting Russia’s economy, which has grown modestly this year on the back of rising oil prices.

The ruble tumbled to 63.5 to the dollar before the sanctions scare, but was above 66 by Thursday afternoon. Russia’s main stock index, the Micex, was down 1.9 percent in midafternoon trading on Thursday.

Some companies were hit harder. Shares in Aeroflot, the national airline, fell as much as 11 percent. The chemical weapons sanctions could ban flights between the United States and Russia within three months, a State Department official told reporters in Washington.

Russian officials responded by casting the sanctions as out of step with efforts by President Trump and President Vladimir V. Putin to smooth over differences at a summit meeting in Helsinki, Finland, last month.

“We again deny any accusations of the Russian government’s possible involvement” in the nerve-agent poisonings, Dmitry S. Peskov, the Kremlin spokesman, said in a conference call with journalists on Thursday.

“Such decisions made by the American side are unfriendly, and you cannot associate them with the constructive, even if difficult, atmosphere we had during the last meeting of the two presidents,” he added.

Mr. Putin holds a “constructive attitude to discuss the most difficult questions,” Mr. Peskov said: “No one can have doubts that Putin preserves this attitude. We regret that this is not always reciprocated by our partners in the West.”

The Trump administration said it was acting in compliance with the Chemical and Biological Weapons Control and Warfare Elimination Act of 1991, which mandates that once the government has determined that a country has used chemical or biological weapons in violation of international law, or even made “substantial preparations” to do so, sanctions must be imposed.

Under the terms, any attempt by an American company to obtain an export license for anything with a potential national security purpose — including gas turbine engines, electronics, integrated circuits and testing and calibration equipment — will be automatically denied.

British officials have declared that Russia was to blame for the poisoning of Sergei V. Skripal, a former Russian intelligence officer once imprisoned for selling secrets to the British, and his daughter Yulia. They were exposed to a rare nerve agent belonging to a class of Soviet-developed chemical weapons known as Novichok.

The Skripals survived, but a woman later exposed to the same chemical has since died.

The 1991 legislation calls for tougher sanctions to be imposed within three months, such as the flight restriction, unless Russia passes several tests, including determinations that it is no longer using chemical or biological weapons, that it provides reliable reassurances it will not use them in the future, and that it allows international inspectors to ensure compliance.

It became clear on Thursday that Russia was unlikely to meet these requirements, with officials reiterating denials of any Russian involvement in the poisoning even as the ruble went into a nose-dive.

In Moscow, some officials described the new sanctions in terms of American domestic politics. They were imposed, the Russians said, as part of a struggle in the United States between President Trump and his supporters, who wanted to engage with Russia, and a “deep state” of national security bureaucrats, who were determined to worsen relations.

“This means more pressure on Russia as well as those U.S. politicians who want a rapprochement with Russia, with the ultimate aim of exacerbating the situation,” Aleksei V. Chepa, the deputy chairman of Parliament’s Foreign Affairs Committee, told the state-controlled broadcaster RT.

Original Article


Please enter your comment!
Please enter your name here