The Russian currency continued its descent on Wednesday as trading in the ruble resumed on the Moscow Stock Exchange. But in a bid to stem the currency’s decline, Russia’s central bank issued an order further restricting access to US dollars.
The Central Bank of Russia said on Wednesday that holders of foreign currency accounts at Russian banks would only be allowed to withdraw up to $10,000 in dollars (regardless of the currency of the account), and the rest should be withdrawn in rubles. New foreign currency accounts can be opened, but only rubles can be withdrawn. The order will be in effect until September 9, the central bank said. Until then, banks cannot sell foreign currency to Russians either.
The measures appear intended to limit the ability of Russian citizens to convert their rubles into dollars or other currencies, as the central bank attempts to prop up the national currency, which is rapidly losing purchasing power.
The Russian ruble has lost around 40% of its value against the US dollar this year as Western leaders moved to isolate the country from the global economy with sanctions in response to its invasion of Ukraine. These measures, which include freezing Russian central bank assets held in the United States, will make it harder for the country to support its currency.
Since currency trading on the Moscow Stock Exchange was interrupted on Friday, the United States and Britain said they would stop importing Russian oil, while the European Union presented a plan to reduce its dependence on Russian energy, and Fitch Ratings said a default on Russia’s sovereign debt was “imminent”.
“The further increase in sanctions and proposals that could limit energy trade increase the likelihood of a policy response from Russia that includes at least a selective non-payment of its sovereign debt obligations,” Fitch Ratings said. Tuesday.
The ruble was trading at 117 rubles to the US dollar in Russia on Wednesday, after closing at 105 rubles to the US dollar on Friday. Ruble trading in world currency markets, which was very limited, valued the ruble at around 139 per US dollar.
Trading on the Moscow stock market is still halted, the central bank said. It was last traded on February 25.