On top of his Ukrainian tribulations Vladimir Putin now has to manage a war of attrition with currency speculators. Lack of confidence in the Russian economy has prompted a flight in capital as some investors seek to limit their losses on rouble assets while others actively bet on a continued depreciation of the currency. The president’s battlefield options range from strategic retreat (allowing depreciation) to raising interest rates and selling foreign exchange to imposing controls on capital outflows.

The first three options are close to being exhausted. The rouble has already depreciated by more than seems warranted even by a pessimistic view of Russia’s economic fundamentals. Last week the Central Bank of Russia increased interest rates to 17 per cent, a level where further increases are likely to be self-defeating because of the economic costs they would impose. Finally, Mr Putin indicated in his press conference on Thursday that the country’s international reserves, while still at a comfortable level, should no longer be wasted in market interventions to prop up the national currency.

This leaves capital controls. Would they work for Russia? What can we learn from international experience of the use of capital controls in currency crises?