The Russian ruble jumps against the dollar, higher than it was before the sanctions.. What's the story?

The exchange rate of the Russian ruble rose in Friday's trading to 68 rubles per dollar, its highest level in two years.

Russian President Vladimir Putin's efforts to support the ruble are bearing fruit. The Russian currency hit a two-year high against the US dollar on Friday. The ruble rose after the country said it was able to pay creditors with dollars as Russia tries to avoid default.

The Finance Ministry said in a statement it had paid out $565 million in European bonds that were due this year, in addition to the 84 million euros that were due to mature in 2024.

The Ministry of Finance claimed that both payments were made in US dollars, as required under the terms of the bond contract.

On April 6, Russia said it had made its ruble payments on those bonds, prompting Standard & Poor's to announce three days later that Russia had defaulted on its foreign debt obligations. Although payments in dollars are already overdue, Russia's delinquency in dollars represents a last-ditch attempt to avoid a default.

Bond payments usually come with a grace period of 30 days. For these bond payments, the grace period expires on May 4. We may never know if Standard & Poor's changed its mind about defaulting in Russia. Because of the sanctions, the credit rating agency withdrew its rating on Russian debt on April 15, according to CNN.

Although Russia has the money to pay its debts, it cannot access about half of that money after the West imposed unprecedented sanctions on foreign reserves, which total about $315 billion.

But it appears that Russia has found a way to repay hundreds of millions of dollars in debt without access to its frozen reserves. A US Treasury official said the payment may have come from a new pile of money, because it has not lifted its restrictions on Russian dollars it has imposed on sanctions, according to Reuters.

The news pushed the Russian ruble, which had been on the rise for two months, to a two-year high against the US dollar. One dollar can buy about 68 rubles on Friday. While at its peak on March 7, the ruble was trading at 135 against the dollar.

Russia has managed to prop up the ruble despite global sanctions by raising interest rates, banning Russian brokers from selling securities held by foreigners and demanding that gas and oil deliveries be paid in rubles, among other measures. These measures allowed Moscow to artificially increase the demand for the ruble even as the country's economy remained in dire straits.

The country has also since managed to pare its massive interest rate hikes, including another surprise rate cut on Friday.

German debt rises citizens donate thousands of euros to pay it off

Amidst the rise in German state debt significantly during the past two years due to the Corona pandemic and the war in Ukraine, hundreds of Germans decided to contribute to the repayment of these debts by donating to the state.

Last year, 236 German citizens donated about 64,000 euros to the state voluntarily, according to the government's response to a request for briefing from former Chancellor Angela Merkel's Christian alliance, the German news agency reported yesterday, Saturday.

The government said that the total donated by these citizens amounted to exactly 63,988 and 54 euros. This money reached the account known as the Debt Payment Account of the Ministry of Finance, which is being used specifically for this purpose.

The volume of donations on this account in 2018 amounted to more than 600,000 euros, which is equivalent to ten times the donations of last year, according to the German "Deutsche Welle" network.

The government said that "the debt repayment account was created by the Ministry of Finance at the request of many enthusiastic citizens, and it is available for voluntary payments, and it is expected that it will continue for this reason in its current form in the future as well."

In its response, the government stated that the five highest payments reached last year's account with Deutsche Bank, ranging between 15,000 and 25,000 euros.

Given the country's billions of euros in debt due to the coronavirus and the conflict in Ukraine, these donations are literally just drops on a hot stone. And government sources revealed a few days ago that Germany plans to increase the new debt by 39.2 billion euros ($42.04 billion) this year to ease the impact of the repercussions of the Russian attack on Ukraine on Europe's largest economy. The planned new borrowing would raise Germany's net debt in 2022 to 138.9 billion euros.

Germany temporarily suspended constitutional restrictions on new debt to fund unprecedented fiscal support for the economy during the coronavirus pandemic, by borrowing 130 billion euros in 2020. New borrowing reached a record 215 billion euros last year.