- The Bank of Russia set official rates for December 31, 2025 at 78.2267 RUB per USD and 92.0938 RUB per EUR.
- The ruble strengthened over 40% in 2025, supported by high interest rates, forced exporter FX conversion, capital controls, and weak import demand.
- Analysts warn this strength is mechanically driven and could reverse if controls ease, sanctions shift, or oil and export revenues fall.
- A strong ruble squeezes exporters and federal budget revenues while offering carry-trade appeal alongside significant tail risks.
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Analysis
The Central Bank of Russia published official exchange rates effective December 31, 2025, which include a USD rate of 78.2267 RUB per US dollar and a EUR rate of 92.0938 RUB per euro. These represent minor adjustments upward from prior rates, reflecting ongoing policy support and macroeconomic pressures.
Throughout 2025, the ruble underwent a dramatic appreciation versus major foreign currencies. It was among the best-performing currencies globally, with year-to-date gains exceeding 40% against the USD. Key drivers include a restrictive fiscal-monetary regime: the Bank has kept key interest rates very high, and unilateral rules force exporters to convert foreign currency proceeds into rubles. Weak domestic consumption and imports have lessened demand for foreign currency.
However, there is consensus among analysts that the ruble’s strength is largely structurally driven and may not hold if some of those supports weaken. For example, if sanctions are partially lifted or capital controls eased, demand for foreign currencies may revive, reducing ruble overvaluation. Similarly, declines in oil prices or export flows would pressure the currency and government revenues.
The indication for strategic investors is twofold: there is a strong carry trade appeal given interest-rate differentials, but also significant tail risks related to liberalization, sanction adjustments, and external revenue volatility. The strength helps Russia’s importers lose competitiveness, squeezes export margins, and reduces the ruble-denominated value of foreign-currency earning sectors, including energy. At the federal level, budget forecasts assume stronger ruble and oil revenues; deviations could widen the deficit.
Open questions include: How sustainable are the export conversion requirements and FX restrictions? What is the likely path of sanctions or geopolitical risk this coming year? And how will global oil market trends feed into Russia’s trade balance and FX reserves? Market models forecasting USD/RUB of 95-100 by year-end 2025 (if supportive fiscal-economic conditions deteriorate) point to asymmetric risk for those positioned on strength.
Supporting Notes
- CBR officially set USD/RUB at 78.2267 effective December 31, 2025.
- CBR set EUR/RUB at 92.0938 for the same date.
- In early-2025, the ruble had recovered from over 100 RUB to USD to approximately 90-USD range, with many forecasts anchoring around 80-100/USD depending on external conditions.
- As of mid-2025 the ruble has gained roughly 40-45% YTD versus USD due to high rates, limited imports, export conversions, and policy measures.
- Analysts caution the ruble is overvalued under its current structure—interest rate cuts, lowered trade surplus, and possible sanction tightening could trigger a reversal.
- The strong ruble reduces federal revenue when accounting from exported goods priced in foreign currencies, as each dollar converts into fewer rubles.