Russia's Central Bank on Monday hiked the key interest rate from 9.5% to 20% in a dramatic move amid sanctions.
The EU, US, UK, Canada and the EU Commission agreed on Sunday to remove several Russian banks from the SWIFT banking system as Russia continued bombing Ukraine.
One Russian rubble traded at 111.52 per dollar at 0830GMT after it fell as much as 40% to 118.6 per dollar, hitting a new record low after Western nations announced new sanctions on Russia over its military operation in Ukraine, according to the Trading Economics website.
"External conditions for the Russian economy have changed dramatically," the bank said in a statement, adding this will help maintain financial and price stability and protect citizens' savings from depreciation.
The bank signaled it would make further decisions on the key rate based on an assessment of risks from external and internal conditions.
It also barred brokers from selling securities held by foreigners on the Moscow Exchange, without mentioning which securities the ban applies to.
Governor Elvira Nabiullina is set to speak at 4 p.m. (1300GMT) in Moscow, the Central Bank said.
Russian Finance Ministry also obliged Russian exporters to sell 80% of their foreign exchange earnings in foreign trade.
Russia’s annual inflation rate accelerated to 8.73% in January, up from 8.39% in the previous month, the highest rate since January of 2016.