Russia is now far less dependent on US dollar or any other foreign currency – central bank

Russia is ready to significantly reduce its dependence on foreign financing, Alexander Morozov, chief of the Research and Forecasting department at the Central Bank of Russia, has told RT.

Moscow has been dumping the US dollar from its international reserves, halving its share to around 24 percent in one year. The diversification could help to mitigate risks, including those linked to sanctions, Morozov said on the sidelines of the 5th Russian-British Business Forum (RBBF) in London.

“We have already made significant progress in this,” Morozov told RT. “If we compare the current situation with what we had 10 years ago, now, whatever happens, the Russian financial system is certainly much more stable.”

He pointed out, however, that getting rid of the US dollar has never been the goal. Moscow just wants to control the risks that any currency could pose, such as liquidity or changes in the exchange rate, according to the financial regulator.

“As Russia trades with many countries in different currencies, we are naturally interested in keeping some share of foreign currency in the structure of our assets. So, we haven’t had the goal to get rid of the dollar, the euro or any other currency,” Morozov stressed.

Russia’s foreign currency and gold reserves have been steadily growing over recent years and have already exceeded half a trillion dollars, thanks to the budget rule. The rule, designed to shield and stabilize the nation’s economy, implies that if oil prices are higher than $42 per barrel, then extra money from the Russian crude and gas exports is transferred to the Russian National Wealth Fund. Thus if crude prices remain above the threshold stipulated by the budget law, Russia is set to further boost its bullion and forex reserves, according to the central bank official.

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