As Russia’s currency crisis unfolds, Russians are scrambling to get their hands on US dollars.
Even Russians working in the oil sector are rushing to trade their rubles in for dollars.
The bank still has rubles.
“Basically, what this means is that people who work in the oil industry [in Khanty-Mansiysk] just got all of their money out of the bank in dollars,” a person familiar with the matter told Business Insider.
Early Tuesday (late Monday ET), the Russian Central Bank raised rates to 17% from 10.5%. The bank’s statement said the decision was driven by the need to limit significant devaluation in the ruble and inflation risks.
In a sentence, it did not work. The Russian currency fell to new lows, reaching 80 rubles to the dollar and 100 rubles to the euro on Tuesday. It first opened 8% stronger after the central bank’s rate hike.
And it’s not just Russians working in the oil industry who are panicking. Everyday Russians are also trying to get as many dollars in their pockets as they can. Some are buying dollars, and others are just trying to withdraw from their accounts in dollars.
“Right now, everyone [in Moscow] is trying to buy dollars, but you can’t buy them just like that — you need to pre-order them,” a person who requested to remain anonymous told Business Insider.
“It looks like no one is trusting the banks anymore,” they continued, “so everyone’s just trying to get everything out.”
One woman stated: “Honestly, I’m not trying to buy dollars, just trying to take out the money from my bank account in dollars — but even still, I have to do it by pre-order.”
Another woman added: “In the morning, I called and asked, whether or not there were dollars, asked whether or not there will be the needed sum, and they responded to me, yes. […But when I went to the cashier…] the cashier told me that only by pre-order, and that he wasn’t allowed to sell them.”
Additionally, Russians are finally starting to feel the financial squeeze from the ongoing economic problems.
“I will easily say that I was robbed twice at least,” one Moscow man told Russian BBC in street interview. “My parent’s pensions are twice as low … no one’s going to increase my pay. So it turns out, I just became twice as poor.”
“Who is to blame?,” he continued. “The government. The president. Where is stability? Where is this ‘slave on the galley’ — where did we just sail? In 15 years, we haven’t established any stability?! One flutter in the markets, and that’s it! Good-bye!”
With the “slave on the galley” phrase, the Moscow man is referring to President Putin, who several years ago infamously said that he works like a “slave on the galley.”
All in all, things aren’t looking good.
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