The case of Sergei Skripal, the former Russian spy poisoned with a nerve agent in the English town of Salisbury, has dominated international news over the last few days. The UK has now announced retaliatory sanctions against Russia and many other countries are expected to join them. In this article, we’ll take a look at what these sanctions may mean for stock and currency markets in Russia, Europe and beyond.
Moves In Russia
Despite all the media attention that has been lavished on Russia over the past few years, the Rouble has been relatively stable. Therefore, it’s unlikely that any new round of sanctions would have a major impact on the Russian currency as such actions appear to have already been ‘priced in’ by investors.
UK sanctions could have a much bigger impact on individual Russian investors, many of whom have major investments in the country or have a residence there. This could be bad news for individual companies that are reliant on Russian investment or custom, although the overall effect on the UK market is likely to be small.
USD/RUB Price Chart
Geopolitical Repercussions
Although the EU has pledged its full support for Britain in this matter, it is likely to be reluctant to impose any major sanctions on Russia unless its hand is forced.