MOSCOW - RUSSIA'S central bank on Tuesday hiked its key refinance interest rate by one percentage point to 12 per cent in an effort to limit an outflow of capital which has sapped the ruble and stock markets.

The measure is aimed 'at reducing the outflow of capital from Russia and to contain inflationary pressures', the central bank said in a statement.

The head of the central bank said on Monday that capital outflows had hit US$50 billion (S$75.2 billion) in October while figures show inflation running at 11.6 per cent over the first 10 months of the year.

Russia has the biggest foreign currency reserves in the world after Japan and China, amassed in recent years thanks to high oil prices, but the central bank has said the reserves have been draining in recent weeks.

Russian markets plunged once more into turmoil on Tuesday as the ruble fell sharply on fears the oil dependent economy is vulnerable to continued falls in crude prices.

In Moscow, the RTS dollar-denominated market lost 10.67 per cent and the Micex ruble market tumbled 12.64 per cent, continuing a traumatic roller-coaster ride for investors now also looking fearfully at a falling ruble. -- AFP