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The ruble has again become the most undervalued currency in the world according to the Big Mac index, its rate should be about 23 rubles per dollar, according to The Economist magazine on February 2.
The so-called Big Mac Index is published twice a year. It is based on the analysis of the purchasing power parity of currencies, based on the cost of a McDonald’s burger. So, if the price of a Big Mac in dollars is higher than in the US, then the corresponding currency is considered overvalued, and if it is lower, then vice versa.
According to the authors of the study, at the moment a Big Mac in the US costs $5.81 (about 444 rubles), while in Russia it costs 135 rubles, or $1.77. Thus, the fair exchange rate of the Russian currency should be 23.24 rubles per dollar.
The second of the most undervalued currencies, analysts recognized the Turkish lira (underestimated by 67.9%).
Among those overvalued as of February 2, 2022, two currencies are represented – the Swiss franc (by 20.2%) and the Norwegian krone (by 10%). In previous ratings, the Swedish krona was also included in this list, now it is considered overvalued by 0.4%.
The ruble was also recognized as undervalued in January and July 2021.
Also in July, Associate Professor of the Russian University of Economics. G.V. Plekhanov Denis Domashchenko said that the ruble has become one of the most undervalued currencies in the Big Mac index, since McDonald’s is profitable to work with such low prices in Russia. According to him, the corporation “can afford it”, given the cost of production, wages, rent of premises and other expenses.
Source: IZ
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
