Russian Central Bank raises key interest rate to 20% per annum

The Bank of Russia has increased the base interest rate to a record 20%, the financial body announced on Monday. The central bank also said Russian residents will have to exchange 80% of revenue received in foreign currencies into rubles.

The moves were made in response to financial sanctions which were imposed by the US and its allies in response to the Russian military operation in Ukraine. Western nations are seeking to cripple Russia’s financial system by a series of measures limiting its access to foreign markets and its own currency reserves.

The Russian central bank said the emergency measures are meant to provide additional stability and to protect savings from devaluation. Further measures may be taken depending on foreign and domestic conditions and other factors, it noted.

Russia launched the attack against Ukraine on Thursday, claiming it was a necessary move to prevent major bloodshed in the future. Moscow said NATO’s creeping expansion into Ukraine, and Kiev’s continued attacks against the breakaway regions in the east, which Russia recognized as sovereign states earlier in the week, left it with no other choice.

Western nations condemned the move and pledged to make Russia pay “a heavy price.”