June 24, 2024

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The US dollar rose to a 20-year high as Russia called up reservists

The US dollar rose to a 20-year high as Russia called up reservists

CNN Business

The US dollar surged to a two-decade high on Wednesday after Russia said it was amassing 300,000 military reserves in an escalation of the war in Ukraine.

In a televised national address Wednesday, President Vladimir Putin immediately announced Partial packing of Russian citizens and threatened to use “every means at our disposal” to defend Russia “and our people”. He also noted the potential use of nuclear weapons.

the speech It pushed the greenback up 0.4% against a basket of major currencies to its highest level since 2002. Investors often seek safe haven in US dollar assets during times of geopolitical tension.

Oil prices also jumped. Brent crude futures, the global benchmark, were up 2.5%, rising to just under $93 a barrel.

Russian stocks plunged 3.5% on Wednesday after the announcement, adding to heavy losses incurred on Tuesday after Putin threatened referendums to annex parts of Ukraine still occupied by Russian forces. The rubles It is also down about 3% against the US dollar.

Asian stocks fell. While indices in Europe eased initially, they were flat or slightly higher in morning trading before the Federal Reserve’s latest policy announcement.

The euro initially fell 0.7 percent to 98 cents ($0.97) against the dollar, but has since risen. The currency used in 19 European countries, sank under the dollar in late August, It was shaken by high inflation and an energy crisis triggered by the Russian invasion of Ukraine in February.

The war has added to investor pressure, as it makes it difficult to predict when inflation will abate and may prompt central banks to maintain an aggressive approach for longer.

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Tara Subramaniam and Andrew Ren contributed reporting.