When she saw the ruble fall, Natalia Prochina rushed to the bank: like her, many Russians fear a crisis and the evaporation of their savings after Western sanctions against Moscow for the invasion of Ukraine.
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On Monday, the Russian currency broke all-time lows, trading in the morning at 100 against a dollar and 109.4 against a euro.
This plunge reawakened in many Russians, already stressed by the conflict, the memory of the financial instability of the 1990s, when millions of people saw their bank savings evaporate under the effect of the devaluation of the ruble and the ‘inflation.
“As soon as I learned that the ruble had collapsed, I ran to my bank, of course,” says Ms. Prochina, a client of VTB bank, Russia’s second-largest institution after Sberbank, both targeted as part of the sanctions announced by Western countries in recent days.
A former journalist on Soviet television, Natalia, 75, was preparing to “withdraw (her) money so as not to lose all her fortune again”, as had already happened to her during the financial crisis of 1998.
“We then lost all our money, including everything my husband had earned during (a mission) abroad,” she recalls.
“I no longer want to play these games with the state (…) which can easily decree martial law at any time and confiscate my savings”, in the name of the war with Ukraine, exclaims the ex-Soviet propagandist with a martial tone.
In front of the entrance to this same bank located in the center of Moscow, Alexander Zouïev, 40, waits his turn to be received by his adviser.
“I think withdrawing cash would be quite reasonable in the current context,” states this elegant frame in the culture. “Everyone has to provide for themselves because no one knows what will happen to the country.”
Behind him, Edouard Syssoïev, a 51-year-old retired soldier, is losing patience: he says he has not been able to withdraw cash from another branch of the bank.
He thinks that “90% of Russians will rush to withdraw their rubles to convert them into dollars, real estate or outright gold”, even if no massive panic movement was observed on Monday.
“It’s the people who will pay for this military banquet,” he says, referring to the intervention in Ukraine launched Thursday by Vladimir Putin.
Another Muscovite, Rustam Yakovlev, also expects general panic.
“Even if the Central Bank (of Russia) assures that everything will be fine, people will panic and withdraw their money,” anticipates this 50-year-old engineer. “Myself, if I had any, I would have taken it all out,” he says.
The Central Bank announced on Monday to raise its key rate very sharply, by 10.5 points, to 20%, after having tried since Thursday to “stabilize the situation” with interventions on the foreign exchange market.
In Saint Petersburg (north-west), about fifteen people were waiting Monday morning for the opening of an agency of the Russian subsidiary of the Austrian bank Raiffeisen.
Among them, Svetlana Paramonova, 58, says she wants to “withdraw her money to keep it at home”. “It’s safer, since we no longer understand anything about what’s going on,” she sums up.
Next to her, Anton Zakharov, 45, wants to do the same, having “no longer any confidence in power or in banks”.
The instability of the rate of the national currency caused by heavy Western sanctions will lead to “lower the standard of living of the Russians within a year”, declared for AFP Alexei Vedev, analyst of the economic institute Gaïdar.
“But the discontent of the Russians only overflows if their standard of living drops three times compared to the current state,” tempers Sergei Khestanov, an adviser for macroeconomic issues at the broker Open Broker.