Russian markets have come under unexpected pressure, with investors increasingly concerned about a possible invasion of Ukraine and the sudden unleashing of unrest in neighboring Kazakhstan.
The ruble weakened to a more-than eight-month low against the dollar this week, with $1 buying 77 rubles, before recovering somewhat Friday. Both local currency and dollar-denominated sovereign debt sold off. The extra yield compared with Treasurys on a Russian government U.S. dollar bond due in 2023 has doubled since November, from around half a percentage point to a full percentage point. The MOEX, Russia’s benchmark stock index, lost 8% last quarter and has retreated further this week.
