25 Rubles – Russian Federation

In 2006, the Russian Federation's currency situation was characterized by robust stability and significant accumulation of foreign reserves, marking a period of strength following the turbulence of the 1998 financial crisis. The key driver was the sustained high price of oil, Russia's primary export, which created a large trade and current account surplus. This influx of petrodollars led to a consistent appreciation pressure on the Russian ruble (RUB). To manage this appreciation and maintain export competitiveness, the Central Bank of Russia (CBR) actively intervened in foreign exchange markets, purchasing US dollars and euros, which caused the country's international reserves to swell dramatically, surpassing $300 billion by year's end and becoming the world's third-largest.

The government's fiscal policy, guided by the newly established Stabilization Fund, played a crucial role in sterilizing the inflationary effects of the oil windfall. This fund sequestered excess oil revenues from the federal budget, preventing excessive money supply growth and "Dutch disease," where other economic sectors become uncompetitive. As a result, inflation was on a downward trend, though it remained stubbornly high at around 9% annually, still above official targets. The CBR continued its policy of a controlled, gradual nominal appreciation of the ruble against a dual-currency basket (USD and EUR), allowing it to strengthen steadily, which helped curb inflation but concerned some domestic industrialists.

Overall, the 2006 currency landscape reflected a confident economy. The ruble was convertible, and discussions about making it a fully freely floating currency were gaining momentum, though the CBR maintained a tight grip on volatility. The primary challenges were managing inflation, sterilizing the vast liquidity inflows, and deciding on the pace of ruble liberalization without harming non-oil sectors. This period of stability and accumulation provided a formidable buffer for the Russian economy, which it would later draw upon during the global financial crisis of 2008-2009.