The ruble sank to a record low, the cost of insuring Russian debt against default soared to the highest since 2009, and stocks ended the main trading session down 33% — their biggest-ever retreat. The Bank of Russia said it will intervene in the foreign exchange market for the first time in years and take measures to tame volatility.
The Russian central bank made no mention of raising interest rates, but said it will provide additional liquidity to banks by offering 1 trillion rubles ($11.8 billion) in an overnight repo auction. Policy makers have increased the benchmark rate by 525 basis points in the past 12 months to tame inflation.
Shares of Sberbank PJSC, Russia’s biggest lender, were down 42%, while natural-gas giant Gazprom PJSC traded 35% weaker.
Russia’s sovereign bonds plummeted and credit-default swap premium soared above 750.
