Russia reduces dependence on US dollar in response to sanctions

  13 August 2018    Read: 746
Russia reduces dependence on US dollar in response to sanctions

Russia is trying to reduce its dependence on the dollar by cutting US securities holdings and settling more trade payments in other currencies, Moscow’s chief economic policymaker said, as he sketched out the government’s response to intensified US sanctions.

Anton Siluanov, finance minister and deputy prime minister for the economy, said the US currency was “becoming a risky instrument in international settlements”.

“We have decreased to a minimum level and will further cut our investment in the US economy, in US securities,” he added, in the most direct confirmation so far of a Russian government sell-off of US Treasuries.

According to data released by the US Treasury last month, Russia’s holdings fell from $96bn to just under $15bn in the two months up to the end of May.

Tension between Washington and Moscow increased further last week, as the US imposed new sanctions on Russia over the case of Sergei Skripal, a former Russian agent attacked with a nerve agent in the UK.

US senators are working on legislation that would put into force still tougher measures against Moscow.

Dmitry Medvedev, Russia’s prime minister, warned on Friday that moves to prevent Russian banks from using the dollar — one of the steps in the draft legislation — would be seen by Moscow as “economic war”. He added that Russia’s response might go beyond economic and financial measures.

 

Financial Times


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