The State Duma Urged To Raise The Dollar Rate To 108 Russian Rubles

The beginning weakening of the Russian ruble is the strongest since the beginning of this year.

The return of the dollar exchange rate to above 100 rubles is "not only logical, but also functionally necessary" for the Russian economy and budget, "Gazeta.ru" member of the State Duma Committee on Small and Medium Entrepreneurship Alexei Govyrin told Gazeta.ru.

According to him, the weakening of the ruble, the strongest since the beginning of this year, should not be seen as a "catastrophe" or "something out of the ordinary," as it is a "controlled process" that will lead to a revival of investment and production activity in the country.

"An excessively strong ruble leads to a decrease in ruble revenues for exporters, makes Russian goods less competitive in foreign markets and reduces budget revenues that depend on export earnings," Govyrin explained. He added that the dollar should return to the range of 88-108 rubles to create "a stable base for budget execution" and support export industries, on which "the country's economy is largely based."

The first half of 2025, the ruble has risen in value by almost 40% against the dollar and the euro, topping the top of the fastest-growing currencies in the world. In January, the U.S. currency fell back to levels below Br80 from the marks above Br110. The euro started the year at 117 rubles, and at the end of May was cheaper than 90.

The result was the problems of the federal treasury: in the first half of the year, oil and gas revenues fell by 14%, and in May and June the decline exceeded 30%. By mid-July, the budget deficit was above 4 trillion rubles, although the Ministry of Finance had initially budgeted 1.2 trillion for the year.

On Monday and Tuesday, after Donald Trump's decision to shorten the ultimatum to end the war in Ukraine and his threat to impose new sanctions on Russian oil, the dollar rose above 82 rubles, the euro - above 95 rubles, and the yuan exchange rate exceeded the mark of 11.5 rubles.

Devaluation is the "only possible" scenario to rectify the budget situation, says Alexander Abrahamyan, head of the wealthy clients department at Alfa Capital Management Company. Each ruble of the dollar exchange rate growth brings from 130 to 200 billion rubles a year to the treasury. "That is potentially here lie on a plate under 1.5-2 trillion rubles at devaluation to 100 rubles per dollar. It's very tempting," Abramyan explains.

According to Reuters, the government and the Central Bank began discussing a scenario of a managed devaluation of the ruble to 100 per dollar back in late May in order to patch up the "hole" in state finances. The agency's source in the Cabinet of Ministers said that a three-digit exchange rate for the U.S. currency was considered safe for the economy, provided that the ruble's decline does not become uncontrollable.

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