The Russian ruble tumbled as much as 2%, sliding to 69.63, the lowest level against the dollar since March 2016 and its biggest drop since August 8 after Russia’s prime minister Dmitry Medvedev effectively admitted that US sanctions are starting to bite, and said that he is hopeful that the Bank of Russia becomes “active” as rates are high.

“It’s necessary to move from neutral to stimulating oversight of the credit sphere to create conditions for more confident economic growth,” Medvedev said at a conference in Moscow, adding that “Interest rates remain quite high despite the successes in holding back inflation.” The prime minister also urged the central bank to take an “active position” to address the issue of elevated rates.

According to Rabobank’s Piotr Matys, “market participants are especially sensitive to any comments on monetary policy from prominent officials in current environment” adding that the USDRUB could approach 71.40 in coming weeks.

“It seems that the market has interpreted comments from PM Medvedev as political interference in the monetary policy. Such remarks may undermine credibility of the central bank and Governor Nabiullina, who is well respected by investors for acting decisively during the ruble crisis only a few years ago”.

“From the perspective of technical analysis comments from PM Medvedev may provide USD/RUB with sufficient momentum to break higher from the consolidation pattern that formed over the past few weeks. This bullish breakout would allow USD/RUB to extend gains towards the next important level at around 71.40 in the coming weeks”

Adding to the ruble’s pain was this statement from Bloomberg:

It came after Theresa May accused Russia of being the Skripal poisoning, and presented alleged evidence that the two suspects in the case are in fact Russian secret service agents. With UK allies now seemingly on board the UK version of events, this heightens sanctions risk as tonight there is a UN session on the topic during which more sanctions could be announced.