Element of chaos in the Russian economy: US

The US has said there is an element of chaos in the Russian economy indicating that there are specific and clear economic costs associated with its President Vladimir Putin's expedition into the eastern Ukraine.
The statements from White House came soon after Russia's central bank cut its interest rate in reaction to the possibility of a recession in the country.
"I won't comment extensively on the actions that were taken by another central bank. But I can say as a general matter, that I also noticed that within the last week or so, the central bank had actually raised interest rates dramatically to try to protect the value of their own currency," the White House Press Secretary Josh Earnest told reporters yesterday.

"This illustrates that there is an element of chaos in the Russian economy. And some of that is a result of the international sanctions regime that this president has led the implementation of," he said.
"That is an indication that there are specific and clear economic costs associated with President (Vladimir) Putin's expedition into eastern Ukraine, that continuing to violate the territorial integrity of one of their neighbors is having an economic impact, a negative one, on Russia," he added.
"As the days go by and as Russia continues to refuse to live up to previous commitments they've made to de-escalate this conflict, those costs are only going to intensify. We are hopeful as these cost mount, that it will prompt President Putin to re-evaluate his strategy," Earnest said.

The United States continues to monitor the situation in Ukraine. We have seen repeatedly that the Russians have been unwilling to live up to their agreements and that a lot of these deaths of civilians are the result of military actions that are taken by separatists that are supported and armed by the Russian military", Earnest said.

"And that is an indication that we need to change the cycle" he said adding that "We are hopeful that as the international community continues to show their resolve and as the costs continue to pile up on the Russian economy, that President Putin ultimately will change course".

Earnest said the longer that the sanctions remain in place, the worse the economic costs that Russia has to bear get.
"I think that's evidenced even by the announcement from the Russian Central Bank today that they're going to attempt to lower their interest rates just a few days after increasing them significantly," he added.