The Central Bank of Russia lowered its key interest rate to 17 per cent from 20 per cent on Friday, as the rouble continued to gain against the dollar this week on the back of capital controls in the country.
The rouble, which slipped some 40 per cent to around 139 to the dollar early last month, has made a dramatic recovery and was trading at 83.9 to the dollar at 3.50pm UAE time.
“The Russian rouble has been an interesting currency this week as it has made a tremendous comeback this week. It has reached its strongest level against the dollar for this year,” said Naeem Aslam, chief market analyst at AvaTrade.
“The rouble plunged when Russia attacked Ukraine, and US President Joe Biden made a joke … by calling it 'rubble'. Now the currency is sitting at a level where it was before the war against the dollar. The most important factor to pay attention to here is that this is despite seeing overall strength in the dollar index this week because of the ultra-hawkish stance by the Fed.”
Russia's central bank had hiked its key interest rate to 20 per cent in late February from 9.5 per cent, the highest hike since 2003, to compensate for the increased depreciation and inflation risks in the country.
On Friday, the central bank said it decided to cut the key rate by 300 basis points from April 11 and cautioned that economic conditions remain “challenging” and that inflation will continue to rise. Annual inflation in Russia surged to 16.7 per cent as of April 1, its highest since March 2015.
“Yet, the latest weekly data point to a noticeable slowdown in the current price growth rates, including owing to the rouble’s exchange rate dynamics. The tightening of monetary conditions already in place is partly offset by the lending support programmes launched by the government and the Bank of Russia, but it will continue to limit pro-inflationary risks,” it said in a statement.
“Today’s decision reflects a change in the balance of risks of accelerated consumer price growth, decline in economic activity and financial stability risks.”
It said that there could be a further rate reduction in the future.
The central bank will take into account “risks posed by external and domestic conditions and the reaction of financial markets, as well as actual and expected inflation dynamics relative to the target and economic developments over the forecast horizon”, it said.
The rouble is also likely to continue regaining ground, Mr Aslam said.
“Given the recent comeback in the rouble, it is very clear that there is not only plenty of demand but strong demand for the currency which has pushed it out of its misery.”
The specs
Engine: 2.0-litre 4cyl turbo
Power: 261hp at 5,500rpm
Torque: 405Nm at 1,750-3,500rpm
Transmission: 9-speed auto
Fuel consumption: 6.9L/100km
On sale: Now
Price: From Dh117,059
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5 of the most-popular Airbnb locations in Dubai
Bobby Grudziecki, chief operating officer of Frank Porter, identifies the five most popular areas in Dubai for those looking to make the most out of their properties and the rates owners can secure:
• Dubai Marina
The Marina and Jumeirah Beach Residence are popular locations, says Mr Grudziecki, due to their closeness to the beach, restaurants and hotels.
Frank Porter’s average Airbnb rent:
One bedroom: Dh482 to Dh739
Two bedroom: Dh627 to Dh960
Three bedroom: Dh721 to Dh1,104
• Downtown
Within walking distance of the Dubai Mall, Burj Khalifa and the famous fountains, this location combines business and leisure. “Sure it’s for tourists,” says Mr Grudziecki. “Though Downtown [still caters to business people] because it’s close to Dubai International Financial Centre."
Frank Porter’s average Airbnb rent:
One bedroom: Dh497 to Dh772
Two bedroom: Dh646 to Dh1,003
Three bedroom: Dh743 to Dh1,154
• City Walk
The rising star of the Dubai property market, this area is lined with pristine sidewalks, boutiques and cafes and close to the new entertainment venue Coca Cola Arena. “Downtown and Marina are pretty much the same prices,” Mr Grudziecki says, “but City Walk is higher.”
Frank Porter’s average Airbnb rent:
One bedroom: Dh524 to Dh809
Two bedroom: Dh682 to Dh1,052
Three bedroom: Dh784 to Dh1,210
• Jumeirah Lake Towers
Dubai Marina’s little brother JLT resides on the other side of Sheikh Zayed road but is still close enough to beachside outlets and attractions. The big selling point for Airbnb renters, however, is that “it’s cheaper than Dubai Marina”, Mr Grudziecki says.
Frank Porter’s average Airbnb rent:
One bedroom: Dh422 to Dh629
Two bedroom: Dh549 to Dh818
Three bedroom: Dh631 to Dh941
• Palm Jumeirah
Palm Jumeirah's proximity to luxury resorts is attractive, especially for big families, says Mr Grudziecki, as Airbnb renters can secure competitive rates on one of the world’s most famous tourist destinations.
Frank Porter’s average Airbnb rent:
One bedroom: Dh503 to Dh770
Two bedroom: Dh654 to Dh1,002
Three bedroom: Dh752 to Dh1,152
HIJRA
Starring: Lamar Faden, Khairiah Nathmy, Nawaf Al-Dhufairy
Director: Shahad Ameen
Rating: 3/5
What the law says
Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.
“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.
“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”
If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.
The biog
Family: He is the youngest of five brothers, of whom two are dentists.
Celebrities he worked on: Fabio Canavaro, Lojain Omran, RedOne, Saber Al Rabai.
Where he works: Liberty Dental Clinic
