As stocks declined amid growing tensions between Russia and the Ukraine, the ruble dropped to a record low. The possible threat of intensifying sanctions became more likely as the Ukraine said the escalation of separatist fighting was a "de facto" incursion.
Lars Christensen, the chief emerging-market analyst at Danske Bank A/S in Copenhagen, said by phone to Bloomberg, "In the last couple of days things have taken a turn for the worse on the ground and the markets are reacting to that. We are likely moving to another round of sanctions."
The currency declined to its weakest level since the beginning of March by 1.6 percent to 36.7325 per U.S. dollar. The ruble is currently trading within 0.8 percent of a record low while the Micex Index was down 1.9 percent to 1,420.23 in Moscow, reports Investing.com.
The Micex experienced this decline after a previous weekly gain. The drop occurred after Ukrainian President Petro Poroshenko called an emergency security meeting as rebels began to increase attacks on parts of Russia. As a result, investor sentiment soured after improving in recent weeks amid optimism that Putin would enforce measures to end the conflict that has killed over 2,000 people, according to BusinessWeek.
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