The Ruble Is Crashing
The currency dropped by as much as 9.3% on Monday - the biggest decline since December 15.
This crash follows the Economy Ministry's announcement that GDP contracted by 0.5% from a year earlier, following a 0.5% increase in October.
"This is linked to sanctions first of all, oil and the panic we saw on the market in December. The damage to the banking system and consumer sentiment will take a long time to repair," Dmitriy Polevoy, the chief economist for Russia and the CIS at ING Bank of Moscow, told the Moscow Times.
Additionally, oil prices have crashed again on Monday.
The price of West Texas Intermediate crude oil plunged to as low as $52.90 per barrel, a 4% decline, and Brent crude oil fell to its lowest price since May 2009 - falling as low as $57.37 per barrel.
Right now, Russia is on the edge of its first recession since 2009. Its economy took a serious beating following the sanctions imposed by the EU and US over the situation in Ukraine and the plunging oil prices.
Following the sharpest fall in Russia's HSBC composite output index since May - down to 47.6 in November from 49.1 in October - analysts began expressing pessimistic views about the state of the economy.
"The PMI survey found the Russian economy risking not only prolonged, but deep recession. We expect 1.5% GDP decline in 2015, but are prepared to see even deeper decline if current negative trends by the PMI survey continue," writes Alexander Morozov, the Chief Economist of Russia, CIS and the Baltics at HSBC.