Contemporary Literature Review of the Russian Rouble Determinants

Abstract

This short literature review’s goal is to examine available papers regarding the study of Russian Rouble determinants. For purpose of analysis, 35 articles were studied among which 22 were selected, for a total of 414 pages shelled. This work analyzes most recent empirical articles, in order to identify factors responsible for the Russian currency fluctuations. Different models will be compared to learn if some are more effective than others, from basic Linear regression to Structural vector autoregressive, through Ordinary least squares or Vector error correction models. Moreover, a very special and particular attention will be paid to variables used. Which combinations of variables are used to study factors influencing the Russian currency? While it seems vital to include oil prices, interest rate, and consumer price index, is it important to have them all together in the same model? Are results among papers similar? In addition, would it be necessary to add variables such as GDP, gold price, gas price, M2 aggregate or sanctions? However, this paper will compare data from each model and try to find out if there is one best way to study the Russian currency determinants.