The country cut the US currency’s share in its foreign reserves before Ukraine conflict
Bank of Russia Governor Elvira Nabiullina says Russia holds enough yuan and gold in its reserves to limit the impact of Western sanctions – even after Washington and its allies froze half the country’s holdings in dollars and other currencies.
The regulator cut the share of dollars in reserves to 10.9% as of January 1 from 21.2% a year earlier. Meanwhile, euro holdings reportedly rose to 33.9% from 29.2%. At the same time, yuan holdings grew to 17.1% from 12.8% a year earlier, while the share of gold held steady at 21.5%.
Ukraine-related sanctions imposed on Russia by the US and its allies include the freezing of up to half of the nation’s $642 billion in foreign currency reserves.
“This extraordinary, shock situation will lead to large-scale changes,” Nabiullina said in her annual report to parliament on Monday.
“The difficult process of adapting to the new conditions will inevitably lead to a contraction in GDP but the Russian economy will be able to return to a growth trajectory.”
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