18 Apr 2023 12:12

Russian Central Bank continues to work on return of international reserves in dollars and euros

MOSCOW. April 18 (Interfax) - The Central Bank of Russia (CBR) continues to work on the return of international reserves in dollars and euros, Central Bank Governor Elvira Nabiullina said in a statement.

"We continue to work to return our reserves in euros and dollars," Nabiullina said at a meeting with the Communist Party faction as part of the consideration of the annual report of the CBR in the State Duma.

Nabiullina recalled that the Russian president has imposed a decree that restricts the withdrawal of funds from Russia by non-residents from unfriendly countries. "This is a retaliatory measure, and here it also forms a negotiating position on the issue," she said.

In the spring of 2022, the EU, the US and a number of other countries froze Russia's international reserves in response to the Ukraine situation. The sanctions have deprived Russia from access to some $300 billion in reserves. Nabiullina announced the preparation of lawsuits in this regard in the spring of 2022.

Russia's international reserves as on April 7, 2023, had reached $600.8 billion, while they totaled $582 billion as on January 6, 2023.

"We are currently forming reserves based on what assets cannot be used for sanctions pressure, but we also take into account how our foreign trade is changing," Nabiullina stressed.

Nabiullina recalled that international reserves have been formed based on two types of risks, financial and economic and geopolitical, since 2014. "In order to protect against geopolitical risks, we have accumulated gold and yuan. In order to protect ourselves from economic and financial risks, for example, such as falling oil prices, which occur quite often, we have kept part of the reserves in those currencies in which our foreign trade was mainly carried out, and this had been in dollars and euros. We now see how the economy is being rebuilt, but it has been going on for many years, with exports-imports in dollars and euros," she said.

Nabiullina said that Russia has a "safety cushion" in non-sanctioned assets. "At the same time, imagine if the problems of the global financial system that exist, and we can now observe them, would catch up with us faster than geopolitical shocks. If in this case we did not have foreign exchange reserves, in the currencies in which our economy operates, then trade would continue in dollars, euros, companies would take debts in dollars and euros, and then we would not be able to dampen the shock to our economy," she emphasized.