Russia’s central bank on Tuesday hiked interest rates by 350 basis points to 12% at an emergency meeting, as Moscow looks to halt a rapid depreciation of the country’s ruble currency.
The ruble slumped to near 102 to the dollar on Monday, as President Vladimir Putin’s economic advisor, Maxim Oreshkin, penned an op-ed in Russian state-owned Tass news agency that blamed the plunging currency and the acceleration of inflation on the “loose monetary policy” of the central bank.
Low rates brought on very slim capital structures financed by corporate paper.
We would deleverage, but it would hurt returns and generally be unpleasant, plus we’d go back to corporations sitting on mountains of cash “just in case”.