Bank of Russia raises key rate to 20%

Russia's Central Bank has raised its key interest rate from 9.5% to 20%. The regulator explained the decision by a drastic change in external conditions after sanctions were imposed.

Western countries earlier announced a freeze on part of the Bank of Russia's gold and foreign currency reserves and the disconnection of several Russian banks from SWIFT. The rouble traded above 100 to the dollar on the over-the-counter market.

The Bank of Russia also required exporters to sell 80% of their foreign currency earnings and did not open stock trading on the Moscow Exchange.

Sanctions and the collapse of the rouble will inevitably affect neighbouring countries as well, including Armenia, whose economy is closely tied to Russia's.