An analysis of the recent strengthening of the ruble argues that Moscow officials talked up the ruble to help the Russian government with its budget deficit. According to the June 6 Moskovsky komsomolets, Russians bought rubles with their dollars in expectation that the dollar would now decline in value, they put their rubles in the state Savings Bank, and that bank gave the ruble accounts to the government to cover the budget deficit. But this “bubble” will soon burst, the paper said, and the ruble should be trading at more than 7,000 to the dollar by fall. “Chernomyrdins come and go,” the paper concluded, “but the dollar stays.”
Turf Wars Prevent Moscow from Using Foreign Assistance.