Wednesday, February 18, 2015

Russian Central Bank Declines to Issue New Denomination

A proposed new banknote denomination scheduled for issue is said to have now been discarded by the Russian Central Bank due to the current economic climate in the sanction-ridden country. According to a recent Moscow Times article (February 16th) a proposed 2000 Ruble banknote designed by Russian advertising firm Provoda and fitting within the present series of designs originally introduced in 1995 and re-denominated in 1997 was to have honored the far eastern city of Vladivostok. The note is said to have been inspired by a song entitled “Vladivostok 2000″ composed and performed by local hometown rock stars Mumiy Troll, headed by vocalist and songwriter Ilya Lagutenko. The song had gained widespread popularity on Russia’s Internet sites since it was released in 1998.

Specimen examples of the proposed note which seem to support the initial production of a limited quantity in anticipation of a possible issue, include the year “2015” and depict various landmark scenes synonymous with the far eastern city founded in 1860 and only a few miles away from the borders of China. The city, with its population of just under 600,000 people is also the home port of the Russian Pacific Fleet and the largest Russian port on the Pacific Ocean. The Central Bank, who commented on the decision to not issue the proposed note said it often receives proposals for new banknotes but declined to issue this one “due to the economic situation in the country and considering the demands of cash circulation,”

The country’s main banknotes in circulation honor several Russian cities: Krasnoyarsk (10 ruble banknote), St. Petersburg (50 rubles), Moscow (100 Rubles), Arkhangelsk (500 Rubles), Yaroslavl (1000 Rubles) and Khabarovsk (5000 Rubles). The Central Bank in 2013 also issued a limited edition 100-ruble banknote dedicated to the Winter Olympics in Sochi. A proposed 2000 Ruble banknote would have a current exchange rate of USD 31.25 whereas this time last year, the rate of exchange would have been USD 41.35. The Russian currency has been under great pressure, losing a quarter of its value within a year against the USD due to the EU and US banking and trade sanctions against the Russian Government for their support of Rebel separatists in Eastern Ukraine as well as the Russian annexation of the Crimean peninsula in March 2014. The level of inflation in the Russian Federation has hit double digit levels and commercial banks in the country have been hard hit by depositors withdrawing money – ditching their rubles for foreign currencies, notably the US dollar and the Euro.

Article courtesy Michael Alexander, Coin Update, February 17, 2015

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