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Rouble tumbles further on oil price slide

Rouble tumbles further on oil price slide
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The rouble has continued to drop in value, hitting a three year low against the dollar as it slid more than five percent in a week.

The Russian currency has been pulled down by the recent big slump in oil prices on which the country’s economy depends.

Increased demand for dollars by one Moscow bank was also cited by traders as a reason for the rouble’s fall.

The central bank played down the situation and said this was “absolutely normal volatility”. Deputy Chairman Sergei Shvetsov added: “It’s pretty OK with us.”

Economists say the rouble’s fall also stems from disappointment among domestic and foreign investors in Russia at the lack of any drive toward political and economic reform since this year’s elections.

They say that leaves Russia more exposed than in the past to a slide in oil prices.

“Russia is crying out for radical reform – it faces huge structural and demographic challenges if it is to avoid terminal decline,” said RBS economist Timothy Ash.

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