Russians react to fall of ruble

MOSCOW – Russian consumers flocked to the stores Wednesday, frantically buying a range of big-ticket items to pre-empt the price increases set off by the staggering fall in the value of the ruble in recent days.

As the Russian authorities announced a series of measures to ease the pressure on the ruble, which slid 15 percent in the previous two days and raised fears of a bank run, many Russians were buying cars and home appliances before prices for these imported goods shoot higher.

“This is a very dangerous situation. We are just a few days away from a full-blown run on the banks,” Russia’s leading business daily Vedomosti said in an editorial Wednesday. “If one does not calm down the currency market right now, the banking system will need robust emergency care.”

Earlier this week, the ruble suffered catastrophic losses as traders continued to fret over the combined impact of low oil prices and Western sanctions over Russia’s involvement in Ukraine’s crisis.

Some signs emerged Wednesday that the ruble’s freefall may have come to an end and the currency could recover, at least in the short-term. After posting fresh losses early Wednesday, the ruble rallied more than 10 percent to around 60 per dollar Wednesday night Moscow time.

Analysts credited a series of reassuring statements from the Central Bank and the government for the improving ruble backdrop.

First, Deputy Finance Minister Alexei Moiseyev said the government will sell foreign currency from its own reserves “as much as necessary and as long as necessary.”

Then the Central Bank announced an expanded series of measures to help calm the situation such as giving banks more freedom to increase interest rates on retail deposits and offering them more flexibility to deal with the ruble’s depreciation on their balance sheets.