Russia’s Central Bank yesterday raised interest rates from 30 percent to 50 percent in a dramatic move to shore up the ruble, hard hit in recent days by a general backlash against emerging markets worldwide. (NTV, May 19) Announcing the move, Central Bank Chairman Sergei Dubinin said Russia had spent half a billion dollars propping up the currency in the past week, and he accused unnamed Western companies of making “speculative attacks” on the ruble. Russia is seen as a high-risk market and there is strong investor concern about the new government’s ability to cut expenditure in line with budget targets without further increasing wage arrears. Strike action by coal miners, some of who have not been paid for up to six months, continued yesterday to paralyze rail traffic in the Far North, Siberia and the North Caucasus. (See accompanying articles)
MINERS CONTINUE PROTESTS.