Russia's central bank has announced that it will not intervene to prop up the ruble, which has lost nearly 40 percent of its value this year under the pressure of Western sanctions.
The Bank of Russia announced in a November 10 statement that it was immediately removing the range it had fixed for the ruble up until now.
The bank had been burning through its $400 billion in reserves to cushion the drop of the ruble, spending a reported $30 billion in October alone to support the national currency.
The bank statement said the decision to allow the ruble to float freely "did not amount to a total renunciation of any interventions in the currency market, which would be possible in case a threat to financial stability appears."
The ruble had dropped to 48 to the dollar on November 7, but the Russian central bank's November 10 announcement lifted the ruble to 45 to the dollar.
Earlier in day, President Vladimir Putin expressed confidence that the plummeting ruble will stabilize, saying its volatility is not tied to the country's economy.
Speaking in Beijing ahead of an Asia-Pacific summit, Putin blamed currency speculation for what he called the "serious fluctuation" of the ruble.
Despite Putin's confident remarks, Russia's central bank has forecast three years of stagnation, cutting economic growth estimates for 2014-16 to almost zero.
The bank's predictions suggested that Western sanctions and lower oil prices are clouding Russia's prospects in the final years of President Vladimir Putin's third term.
The base scenario set out in an annual monetary policy strategy document issued on November 10 forecast economic growth of 0.3 percent this year, zero in 2015, and 0.1 percent in 2016.
The bank's forecast anticipated that Western sanctions imposed over Russia's actions in Ukraine would last at least until the end of 2017.
It was based on the assumption that the oil price will rise to $95 per barrel next year but then decline again.
It predicted better growth rates if the sanctions are lifted earlier or oil prices are higher than expected.
With reporting by Reuters, AFP and AP