The rouble’s astonishing recovery

The tank columns are stalled; one or two towns captured from the Ukrainians have been retaken. Russia’s war effort has been going nowhere fast for the past fortnight – unless you count the constant pounding and destruction of apartment blocks a form of progress.

But then is the economic war being waged against Russia making any greater progress? True, Muscovites can no longer get a Big Mac, and western-made luxury goods have disappeared from the shelves. Yet look at the dollar’s march against the rouble and it is starting to look like a convoy of Russian armoured vehicles. For the first few days, the rouble sank inexorably as sanctions kicked in. On the day before Putin marched in on Ukraine, a rouble was worth $0.012. By 8 March it had plummeted by nearly half, to $0.007. But then? The rouble has steadily advanced back almost to where it was before the invasion.

The Russian stock market has not quite enjoyed the same bounce. But since it partially reopened last week it, too, has risen sharply. The Moscow Exchange index stood at 3,646 on 16 February. It plunged by nearly half on the morning of 24 February, reaching 1,943. Yet this morning it stands at 2,377. For anyone brave enough to invest at the bottom – and prepared to overlook the ethical issues – Russian stocks have been one of the best investments around over the past week. That is remarkable given the increasingly obvious signs that the war is not going well, and that Russia could find itself sunk into a quagmire for many years.