"The Curse Of August" Has Hit The Russian Ruble
- 7.08.2026, 15:25
The market is reacting to the progress of the "hellish sanctions" bill in the U.S. Senate.
The Russian foreign exchange market kicked off a traditionally troubled August—a month that, since the collapse of the Soviet Union, has become a time of hardship and disaster for the country—with a drop in the ruble’s exchange rate, according to The Moscow Times.
On Friday, August 7, the over-the-counter dollar exchange rate rose above 83 rubles for the first time since late March (83.01 rubles, according to brokers), while the euro exchange rate reached 95.64 rubles, also hitting a more than three-month high. The yuan’s exchange rate on the Moscow Exchange held steady above 12 rubles (12.17 rubles at 1:40 p.m. Moscow time), having gained nearly 4% since the start of the week.
The currency market is reacting to the progress in the U.S. Senate on the “hellish sanctions” bill, and, in addition, some of the rubles that people are withdrawing from banks (more than 2 trillion rubles since the start of the year) may be being converted into foreign currency, notes Finam’s leading analyst Alexander Potavin.
The increased demand is also linked to fuel purchases abroad, even as the inflow of foreign currency into the economy has declined, Potavin continues: In August, foreign exchange proceeds from oil sold in June and July enter the market, and at that time, the price of Russian Urals crude had fallen to $40.
“We’re starting to run short on foreign currency,” notes Andrey Khokhrin, CEO of Ivolga Capital: by the end of July, this became evident on the interbank market, where a shortage of yuan emerged. The rates at which banks lend to each other in Chinese currency soared to 9% per annum, although they normally remain below 1%.
Over the three decades of post-Soviet history, the ruble has managed to end August in the black only eight times—a month that has come to be seen in the public consciousness as “cursed” for Russia: in August 1991, the coup attempt took place; in August 1998, Russia defaulted; in August 2004, a series of terrorist attacks took place, culminating in the hostage crisis in Beslan on September 1. In August 2000, the nuclear submarine Kursk sank—just a few days after a deadly explosion in a Moscow Metro underpass.
Analysts at Alfa Bank note that the ruble is currently under additional pressure from currency purchases by the Ministry of Finance and the Central Bank: the authorities are replenishing the depleted National Wealth Fund using oil and gas revenues from the budget, and this month they will purchase 128 billion rubles worth of yuan and gold.
The ruble has depreciated by about 20% from May’s levels, and the downward trend may continue, according to Alfa Bank: by the end of the year, it forecasts the dollar will rise to 87 rubles.