Russian Central Bank to resume buying, selling foreign currencies in 2024
Date
11/28/2023 3:34:10 AM
(MENAFN) The Russian Central bank declared on Monday its intention to resume the buying and selling of foreign currencies through its sovereign wealth fund starting next year. This decision comes at a time when the Russian ruble is in the process of recovery following a substantial decline experienced during the summer months. The volatility of the Russian currency has been particularly pronounced since February 2022, coinciding with Russia's military operation in Ukraine and the subsequent imposition of unprecedented sanctions by the West on Moscow.
In response to the challenges posed by the fluctuating currency, the ruble has witnessed a notable resurgence, marking a 14 percent increase since the commencement of October. Moscow implemented a series of measures to stabilize the currency, including the reinstatement of currency controls, elevation of interest rates, and cessation of interventions in the foreign exchange market.
The Russian Central Bank's announcement on Monday outlined the resumption of operations under the "budget rule" commencing in January 2024. These financial transactions had been temporarily halted in August when the ruble fell below 100 against the dollar.
The "budget rule" mechanism involves the central bank engaging in the buying and selling of foreign currencies, including the Chinese yuan following Western sanctions. This strategy aims to restore stability to the ruble, which is significantly influenced by global oil prices and Moscow's revenues from its vital energy exports.
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