Russian rouble drops to fresh record low in thin offshore trade By

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LONDON (Reuters) – Russia’s rouble tumbled to a fresh record low in thin offshore trade with local markets closed for trading until at least Wednesday.

The rouble weakened to 130.9338 to the dollar after closing at 121.037 on Friday, according to Refinitiv data. On the EBS trading platform, the rouble softened to as low as 140.00 against the dollar.

Bid/offer spreads were between 10 and 15 cents, pointing to an increasingly illiquid market.

Trading on the Moscow exchange MOEX is scheduled to be closed until Wednesday for a bank holiday. Stocks last traded on Feb. 25 on Moscow’s bourse.

The rouble has lost more than 40% its value against the greenback since the start of the year with losses sharply accelerating since Russia invaded Ukraine on Feb. 24, which sparking sweeping sanctions from Western capitals, isolating the country from international financial markets.

“It has become very difficult to trade the rouble after the sanctions,” said Aaron Hurd, senior portfolio manager, currency at State Street (NYSE:) Global Advisors. “Liquidity has vanished and markets have become very volatile.”

Russia calls its actions in Ukraine a “special operation.”

implied volatility gauges – a measure of demand for options on the currency rising or falling against the dollar – have stayed near record highs hit last week with the one-week gauge above 84% and the one month one above 94%.

The rouble’s collapse has also hit trading volumes. Turnover on the Russian currency on EBS fell more than 80% on Friday compared to the end of February.