The closely linked Russian and Belarusian currencies have weakened sharply amid an ongoing slew of seemingly unrelated political and diplomatic challenges for the two post-Soviet neighbors.
Russia's ruble hit a five-month low against the U.S. dollar on April 7 despite hints at a possible monetary tightening by the Russian central bank that could have propped up the currency.
The Belarusian ruble weakened to a record of 2.66 to the dollar the same day, breaking a previous low from February and nearing levels from the weeks just after a disputed election in August 2020.
Both economies have been stymied by Western sanctions, blacklisting, and other punitive measures over their authoritarian leaders' increasingly repressive tactics to quell dissent.
Russian President Vladimir Putin faces increasing international pressure over the poisoning and jailing of opposition leader Aleksei Navalny, while Alyaksandr Lukashenka, who had ruled Belarus since 1994, has been condemned in the West for his brutal crackdown on peaceful protests since a dubious reelection claim in August.
Experts also cite fears of escalating conflict near Ukraine's border with Russia, where Moscow has acknowledged a troop buildup as skirmishes intensify in Ukraine six years into a conflict between Russian-backed separatists and forces loyal to Kyiv.
NATO and Western leaders have stepped up contacts with Ukraine's leadership and warned Russia against "provocations."
Currency traders think a Russian interest rate hike is coming but the Russian ruble remains stubbornly low "due to fears over military escalations in Donbas," Credit Suisse analysts wrote in a note this week, referring to the eastern region of the former Soviet republic.
Pandemic Problems
In addition to international sanctions over Moscow's actions in Ukraine, Russia's economy has also been hit hard by the coronavirus pandemic and low oil prices.
Analysts have suggested Russia's recovery after the pandemic will lag behind those of many other emerging markets amid what they called lingering signs of "fundamental weakness."
In Belarus, tens of thousands of people have been detained in the protests since a presidential election that the opposition and the West say was rigged.
Most of the opposition leadership has been arrested or forced into exile, including opposition leader Svyatlana Tsikhanouskaya, who has been rallying international support for the pro-democracy movement since fleeing to Lithuania.
The West has responded with sanctions on top officials and rejects Lukashenka as Belarus's legitimate leader.
The Belarusian economy was already in a weak position before the political crisis, while the coronavirus pandemic has created additional problems.
Andrei Karpunin, chairman of Belarus's Club of Financial Directors, cited a decrease in remittances from Belarusians working abroad as a major factor in that currency's fall.
But he also predicted that if sanctions continue to dog the economy, Belarusians will have little choice but to withdraw ruble deposits to convert them into hard currency, further hurting the exchange rate.