Russia's ruble falls to lowest this year, market drops over 4%

Russia's dollar-denominated RTS index fell 4.21% at opening on August 24, 2015, as the ruble tumbled to 70.92 against the dollar (AFP Photo/Sergei Supinsky) (AFP/File)

Moscow (AFP) - Russia's battered ruble dropped Monday to its lowest point this year as Asian and European stock markets nose-dived over concerns about the Chinese economy.

Russia's dollar-denominated RTS index fell 4.21 percent at opening as the ruble tumbled to 70.92 against the dollar, its weakest against the greenback since December 2014.

The ruble-denominated Micex meanwhile dropped by 1.76 percent.

The plunge in oil prices and Western sanctions over Moscow's role in the Ukraine crisis have pummelled the Russian economy in recent months, with the ruble collapsing in value. Russia's recession worsened in the second quarter as the gross domestic product contracted by 4.6 percent compared with the same period last year.

Russia's currency has fallen more than 20 percent against the dollar in the past two months, sparking fears of more instability after a period of relative recovery.

The ruble lost around half of its value in 2014 but recovered slightly as energy prices stabilised this year, allowing officials to claim the worst of the crisis had passed.

But the recent decline, resulting in part from a renewed fall in oil prices, has highlighted how volatile the situation remains.

The recent slump has seen the central bank curb moves to cut back interest rates in an attempt to assuage inflation fears.