MOSCOW (Reuters). The Kremlin lamented Russia’s high inflation rate of more than 8% on Wednesday and stated that steps are being taken to get it under control. Authorities focused on economic stability amid a falling rouble, and a sell-off in stock markets.

Russia’s consumer inflation was 8.39% as of 2021. It accelerated to 8.61% by Jan. 10. This is well over the 4% target. Living standards have been impacted and President Vladimir Putin called for preventive measures.

Dmitry Peskov, spokesperson for the Kremlin, said that inflation is “unacceptable to anyone”. The Kremlin’s spokesperson Dmitry Peskov said the inflationary surge was due to both internal and external factors. “Energetic measures are being taken” to minimize the effect of the rising inflationary pressures.

While the ruble gained ground Wednesday and traded at around 76.37 dollars, it still remained well below its levels last week of around 74.770, as investors were worried about Russia’s military buildup close to Ukraine.

Peskov stated that the rouble, a currency, is subject to volatility, and therefore, negative and positive factors have an effect. However, this is precisely what daily and scrupulous work by the central bank and government on macroeconomic stability support is about.”

Since October, Russian assets are under severe pressure. On Wednesday, the central bank stated that foreign investors sold OFZ Treasury Bonds worth 214 billion rubles ($2.81 Billion) in November and December. This is a comparison to the capital outflows during the stress periods in April 2018 (April 2018) and March 2020.

After falling for several sessions, stocks were rebounding and analysts said that strong macroeconomic fundamentals could be a reason for optimism.

Moscow is known to have been hoarding funds since Western nations imposed sanctions in response to its annexation Crimea by Ukraine in 2014. It has built up its international foreign and gold reserves to $630.5 million as part of its wider efforts to safeguard itself from external shocks.

According to data from the finance ministry, Russia’s budget surplus in 2021 was 514.8 billion rubles. This resulted in a combination of rising gas prices and an exploding oil market in recent months.

Aton Investment Management said, “If an investor doesn’t have any Russian equity positions currently, this is a good time to begin building a long term portfolio with Russian equities over a 6-12 month period or longer.” ($1 = 76.1239 roubles)