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Opinion
Mohamed A. El-Erian

How Close Is Russia to Financial Crisis?

As Russia appears to be losing control of its currency market, the financial media is warning about a possible crisis. Here are seven things to know about what’s going on in Russia now.
Currency problems are looming.

Currency problems are looming.

Photographer: Andrey Rudakov/Bloomberg

As the central bank of Russia appears to be losing control of its currency market, the global financial media is warning about a possible financial crisis there. Some experts have even drawn parallels to August 1998, when a Russian default caused global economic and financial disruptions. Against this background, here are the seven things to know about what’s going on in Russia now.

Aggravated by lower oil prices, the recent financial turmoil reflects the geopolitical tensions and Russia’s decision to favor regional adventures over internal economic and financial stability. The sovereign analysis that the vast majority of investors use isn’t often comprehensive enough to easily and effectively capture this reality.