The Bank of Russia explained the need to diversify reserves. The Central Bank clarified that she was preparing for two different types of crises – financial and geopolitical, response strategy for which are different. Also, the bank confirmed that at present, all gold from gold and foreign exchange reserves is in storage facilities in the country.
The Central Bank explained in his Telegram-channel that since 2014 took into account two possible types of crises. The first is a traditional financial crisis, which previously happened in 2008, 2014 and 2020. With such crises, prices for export goods are significantly reduced, there is a sharp outflow of capital from countries with developing markets. “At such a time, I need reserves in the currencies of the countries with which Russia is conducting active trade and in which the debts of companies, banks and the state are nominated. These currencies are predominantly dollars and euros,” the bank notes.
The second type of crises is geopolitical. To resist such a crisis, reserves are needed to which the sanctions of Western states cannot affect. Therefore, the Bank of Russia in recent years has increased the share of gold and the Chinese yuan almost to half the reserves.
The regulator also stressed that it is impossible to avoid freezing of foreign exchange reserves in dollars and the euro. “Cashless currency is always reflected in correspondent accounts in foreign banks and therefore can be frozen” – the Central Bank. But after freezing the reserves of the Bank of Russia in dollars and the euro, Russia applied a mirror measure, reminded the regulator. In particular, restrictions on the movement of capital were introduced, a ban on the sale of securities by foreign investors and a ban on the conclusion of funds from the Russian financial system.
In addition, payments on the corporate debt of Russian companies and public debt to debt holders from countries that support sanctions against Russia will be held only with the permission of the government commission. “That is, in response to the freezing of part of Russian reserves, Russia also introduced restrictions on the movements of funds that could be listed in unfriendly countries, on a comparable amount,” approve in the Central Bank.
about half of the gold and foreign exchange reserves of the Central Bank ($ 300 billion) turned out to be frozen due to the sanctions of the West in response to the commissioning of Russian troops to Ukraine on February 24. On that day, international reserves of Russia reached a new historical maximum – $ 643.2 billion