Russian Minister Celebrates Ruble’s 20% Slump as ‘Awesome’

Not everyone in Moscow is mourning the ruble’s 20% plunge against the dollar this year. The government minister in charge of getting companies to keep production at home thinks it’s “awesome.”

Russian companies that don’t rely heavily on imports “are in a sweet spot right now,” Industry and Trade Minister Denis Manturov said in an interview on Wednesday.

The Kremlin has introduced measures to get companies to be less reliant on imports since U.S. and European sanctions curbed Russia’s access to international markets in 2014. Manturov said three years ago that a ruble rate of 62 per dollar would be an optimal level for the policy to blossom. The currency was trading near 78 per dollar on Thursday.

The ruble is one of the worst-performing currencies in emerging markets this year due to a slump in global oil prices and concern the U.S. and European Union may introduce new sanctions. Economy Minister Maxim Reshetnikov said in parliament Thursday that the currency is undervalued, while the central bank has warned the devaluation may push inflation above a 4% target.

After a deep slump in the second quarter, the Russian economy bounced back over the summer after many lockdown restrictions were lifted. Industrial production will probably only shrink 4.5% for the full year, while manufacturing will contract 2%, Manturov said.

Virus infections have surged in recent weeks, with daily tallies surpassing levels reached in the spring. Manturov said the government isn’t discussing any plans to prolong support measures for businesses.

“We hope that the peak is over,” Manturov said. “The recovery was very quick in many industries.”

— With assistance by Zoya Shilova, Annmarie Hordern, and Dina Khrennikova

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