After the collapse of oil price and imposition of international sanctions 5 years ago, the Russian RUB hit the rock bottom. Since December 2014, the Russian currency has seemed to be caught in a never ending downward spiral, reaching a historic low in January 2016.
After the ‘Maidan revolution’ of 2014, the National Bank of Ukraine abandoned the exchange rate peg to the US dollar and switched to a flexible exchange rate, which was later formalized within the framework of a newly adopted Inflation Targeting regime.
Governor Boštjan Jazbec entered his corner office on the first floor of Slovenia’s Central Bank (Banka Slovenije) and found himself surrounded by the criminal investigators from the National Investigation Office (Nacionalni preiskovalni urad).
Central banks have been entrusted with the task of developing and implementing measures for limiting systemic risk. They should cope with this task but if they don’t succeed, central banks are risking their credibility.