Last week the Russian ruble hit a seven-year high against the U.S. dollar and while analysts have downplayed the rise, one economist said people should not “ignore the exchange rate.” American economists have been perplexed about the ruble’s market performance and Russian officials have been quoted as saying that a strong ruble “makes Russian exports more expensive.” Furthermore, U.S. president Joe Biden continues to blame high gas prices on Vladimir Putin.
That exchange rate you see for the ruble is there because Russia is earning record current account surpluses in foreign exchange. Although Russia may be selling slightly less to the West right now, as the West moves to cutting off [reliance on Russia], they are still selling a ton at all-time high oil and gas prices. So this is bringing in a big current account surplus.
