Depreciation of the ruble will likely exacerbate inflation in Russia. Consumers in Russia are rushing to
purchase durable goods, like cars, which are now viewed as more reliable stores of value than the
ruble. A weakening of the ruble also raises the value of foreign-currency debt in terms of rubles. The
Russian government has relatively little debt, but some Russian corporations are more indebted. High
interest rates will likely have severe adverse consequences for Russia's growth prospects.