Russia's rouble has fallen to a fresh all-time low against both the dollar and the euro after the political turmoil in Ukraine intensified.

The rouble fell 2.5% to 36.5 roubles against the dollar and 1.5% against the euro to 50.30.

Stocks on Moscow's MICEX main stock index also fell, dropping 9% in early trading.

The sharp falls came as Russia's central bank hiked its key lending rate on Monday to 7% from 5.5%.

"The decision is directed at preventing risks to inflation and financial stability associated with the increased level of volatility in the financial markets," the central bank said in a statement.

Selling 'fervour'

At the weekend, President Vladimir Putin received parliamentary approval to deploy Russian troops in Ukraine.

His spokesman said he yet to decide whether he would send troops in.

"Now that (Russia and Ukraine) are actually on the verge of a military confrontation investors will start selling Russian stocks with special fervour," analysts at Rossiysky Capital said in a note for investors.

Artem Argetkin, trader at BCS in Moscow, said brokers were trying to close their positions at any price.

"There's a sell-off of everything right now," he added.

Financial backing

Operators of privately run exchange booths in Russia said they were not prepared for the higher demand for the US dollar.

An employee at a small exchange said that her booth, which is open 24 hours a day, ran out of dollars by Sunday morning.

"We were not ready for this, we have not stocked up," she said.

Meanwhile, the G7 nations of Canada, France, Germany, Italy, Japan, the UK and the US said they were ready "to provide strong financial backing to Ukraine".

Ukraine needs an estimated $35bn (£20.9bn) over the next two years, according to its finance ministry,