After falling steadily for days after Russia’s invasion of Ukraine, the ruble – Russia’s currency – is back despite tough Western sanctions against Moscow. On April 1, the ruble was pegged at around 82 to the US dollar whereas before the invasion the currency was trading at around 76 to the dollar.

Less than a month ago, on March 7, the ruble recorded a new low of around 137 per dollar.

Although several outlets, including Reuters, have said the ruble’s dramatic rebound does not mean “the sanctions-ravaged Russian economy is out of the woods”, analysts told India Narrative that Moscow may have pulled out a rabbit from the hat.

In an effort to support the ruble, the Russian Central Bank announced the peg of the currency to gold – one gram of gold is currently pegged at 5,000 rubles. This move should increase the flow of gold into the Russian Central Bank’s pool.

With Russian gold under sanctions, the country’s gold stocks, both banks and individuals, could be sold to the central bank. The value of the ruble will rise again as central bank gold stocks from domestic sources increase, which is expected to happen in the coming months.