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Strong Euro increases Russian indebtedness

Izvestia.ru reported on 3 July that Moscow currency-exchange outlets were selling euros on 2 July for 31.51 to the ruble, while the U.S. dollar was being sold for 31.01 to the ruble. The website stressed that although demand for the euro in Russia is currently not very high, demand will obviously increase if the euro sustains its strength against the dollar.

Meanwhile, presidential economic adviser Andrei Illarionov said on 3 July that every increase of the euro's strength by one cent against the dollar increases Russia's foreign debt by $100 million. This is because most Russian debt is denominated in dollars but owed to European countries.

(RFE/RL 03.vii.02)

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