Analyzing Volatility Jumps in the International Monetary System : Impact of Russia-Ukraine Conflict on Currency Exchange Rates

The economic division within a domestically integrated country has been influenced by several factors, leading to the stimulation of irrational actions and risks that significantly affect the currency value in related countries. This study attempts to analyze the volatility outcomes measured through the exchange rate system of the Euro and the American Dollar (in general) due to the exchange of the Ruble's value, analyzed using the jump diffusion concept 𝐽𝑖 and 𝑆(𝑡) as a predictive forecasting model. A total of 306 data points were inputted using simple probability sampling techniques and analyzed through ARCH-GARCH prediction with ARMA. The research findings reveal that the data in the study exhibit Mean Reverting conditions or extreme data conditions, resulting in relatively high daily volatility jumps of 60.90% for the EUR/RUB sample and 58.17% for the USD/RUB sample. Furthermore, there is evidence of parameter gap phenomena that make this research consequential to the sensitivity of jump size estimation, placing exchange rate expectations at a critical threshold that cannot be explained