RUSSIA: DEVALUATION OF THE ROUBLE SITUATION UPDATE

(18 Aug 1998) Russian/Eng/Nat

The leader of the opposition in the Russian parliament says President Boris Yeltsin has "devalued himself" by allowing the rouble to take a dive.

Communist leader Gennady Zyuganov said the rouble devaluation is the latest in a long line of Yeltsin failures.

And he repeated his call for mass protests and the president's resignation.

The rouble dropped sharply on Moscow's Inter Currency Exchange on Tuesday morning.

That followed measures by the central bank and government the day before that were seen as a de facto devaluation of the currency.

Foreign investors are saying the government has at least taken decisive action, but the markets remain cautious.

And with much of Russia on holiday, it's a little early to see how ordinary people will react.

SOUNDBITE: (English)
"The government right now has a little free time only because a lot of Russians are on vacation, August being the big month for vacations but in the next one or two weeks we'll know whether or not foreign investors are happy with terms of the GKO restructuring, short-term debt restructuring and then subsequently we'll know whether or not the government has the political will and the financial resources to keep the population calm about the fall in the value of the rouble."
SUPER CAPTION: Charlie Ryan, United Financial Group

The country's newspaper's were dominated by rouble developments.

There have been mixed views from ordinary Russians.

Some are optimistic.

SOUNDBITE: (Russian)
"I think that in a week everything will resolve and settle down."
SUPER CAPTION: Victoria Shorina

Others are not.

SOUNDBITE; (Russian)
"The situation in our country is very difficult and unpredictable now. It's a hopeless situation, we've lost our belief in anything. Most of the people have lost their believe; it is very dangerous."
SUPER CAPTION: Svetlana Petrova

But many have criticised President Boris Yeltsin for putting himself in an embarrassing position by denying that devaluation was on the agenda just days before the move.

In the Russian capital, demand for dollars was low as people waited for the rouble to stabilize at a higher level and there was no panic withdrawal of deposits.

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