MOSCOW: Russia’s central bank said Monday (Tuesday in Manila) that it was suspending foreign currency purchases after the stock market and ruble fell over fears Russia would attack Ukraine.

Shares fell sharply after two weeks of steady decline, with the dollar-denominated RTS (Russia Trading System) index falling 9%.

The Russian currency fell to its lowest point in more than a year against the dollar at 79 rubles.

Russia’s central bank said it was suspending purchases of hard currency in a bid to reduce volatility in financial markets.

“This decision was made in order to increase the predictability of the actions of monetary authorities and reduce volatility in financial markets,” the Bank of Russia said.

The bank did not give a timetable, adding that it had enough instruments to guard against risks to financial stability.

“Markets are becoming aware of increasing geopolitical risks and sanctions around Russia,” Timothy Ash, senior emerging markets strategist at London-based Bluebay Asset Management, said in a note to clients.

In consultation with the United States and other allies, the European Union is pushing to put in place a set of sanctions against Moscow that it hopes will help deter Russia from military action.

“We expect Russian stocks to extend their losses today due to an escalation in geopolitical tensions over the weekend,” Alfa Bank analysts said earlier in the day.

Renaissance Capital said the ruble could drop up to 20% against the dollar in the event of a military escalation.

Tensions are rising over Russia’s deployment of some 100,000 troops to Ukraine’s borders.