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Russia's central bank on currency control eases foreign exchange

Russia's central bank will permit banks from "foreign countries" to trade between foreign currencies on the country's forex markets.


Russia's central bank on currency control eases foreign exchange

MOSCOW, July 20 (Reuters) - Moscow has designated nations that impose sanctions against it as "unfriendly," a list that also includes the United States, Britain, Japan, Australia, and the entirety of the European Union. Russia's central bank will permit banks from "unfriendly countries" to trade between foreign currencies on the country's forex markets, said the regulator. 

30% limitation on advance payments to non-residents on import contracts for specific services was removed by the bank. This restriction resulted in currency controls imposed when Russia pushed tens of thousands of troops into Ukraine, which has led to a wave of Western sanctions. According to the central bank, easing the restrictions will "promote international economic activity and foster the development of new supply networks."

The removal of the U.S. dollar, the euro, and other currencies of nations that have placed sanctions on Moscow since February 24 have been pushed by Russia in its banking sector. The rouble has soared to multi-year highs amid declining imports and restrictions on foreign currency trading and withdrawals. However, officials have been concerned, claiming that the country's industry is suffering as a result of the strong currency, prompting the central bank to cut interest rates and gradually eliminate some restrictions.

Allowing non-resident banks from "foreign states" to begin trading between various foreign currencies on the Russian market will "help Russian banks better meet the demand of companies and citizens," it claimed. According to a statement from the central bank, trading in roubles will continue to be outlawed, and non-financial foreign firms from "unfriendly nations" are still prohibited from engaging in any Foreign exchange trading on the Russian market.

Source: https://www.reuters.com/markets/europe/russias-central-bank-eases-more-currency-controls-2022-07-20/

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