After September 9: why the Central Bank decided to extend restrictions on the withdrawal of foreign cash

The Central Bank of Russia in September will extend restrictions on the withdrawal of cash foreign currency.

This was announced on Friday, July 22, by the head of the regulator Elvira Nabiullina.

“We have no reason to expect that the situation with the flow of foreign currency in cash (to Russia. -

) will change for the better in the near future ... Therefore, in September we will be forced to extend the restrictions that we introduced in early March,” Nabiullina said during press conferences.

As the chairman of the Central Bank recalled, earlier Western states banned the import of dollars and euros into Russia.

Against this background, today the supply of foreign currency in cash in the country remains limited.

“There is that cash currency that is already in circulation.

There is cash in banks, which is designed so that people can withdraw cash (from deposits. -

) within the allowed limit ... Our banks should be able to ensure for all citizens their rights to previously opened currency accounts, ”added Nabiullina .

• © Press Service of the Bank of Russia

Recall that at the beginning of March 2022, the Central Bank introduced a temporary procedure for the circulation of cash currency in the country.

In particular, the regulator banned Russians from buying foreign banknotes at the cash desks of banks and set a limit on the withdrawal of dollars and euros from accounts.

Now clients can receive foreign currency from deposits only with the equivalent of no more than $10,000, and the rest of the funds in rubles.

“What is important, this limit covers 90% of all foreign currency deposits.

That is, 90% of people who have foreign currency deposits can completely withdraw their deposits in cash.

Few are in a hurry to do this,” said Elvira Nabiullina.

It is noteworthy that in April the Central Bank eased restrictions somewhat and still allowed Russians to buy cash dollars and euros from banks.

However, credit institutions can sell to the public only the currency that came to their cash desks starting from April 9.

Initially, it was assumed that the temporary procedure for the circulation of cash currency would last until September 9.

However, as Dmitry Babin, an expert on the BCS World of Investments stock market, noted in an interview with RT, the ban on the import of dollars and euros by Western countries is unlikely to be lifted in the foreseeable future, so the extension of restrictions is necessary.

“Due to the initiative, the regulator managed to prevent mass withdrawals of cash from foreign currency accounts during the period of destabilization of the foreign exchange market and high uncertainty associated with the deterioration of the geopolitical situation in late February and early March.

Now the measure allows the banking sector to fulfill its obligations on foreign currency deposits,” Babin added.

A similar point of view in an interview with RT was also expressed by Georgy Ostapkovich, director of the Center for Market Research at the Institute for Statistical Research and the Economics of Knowledge at the Higher School of Economics.

According to him, the restrictions were introduced primarily in order to moderate the panic in the Russian financial market and stabilize the ruble exchange rate.

“After the start of the special operation and the imposition of sanctions, chaos ensued in the markets.

People were buying up the currency at a very high rate - more than 100 rubles per dollar.

Speculators bought up the currency and sold it to the population at a large markup, resulting in a shortage of cash currency.

The actions of the Central Bank helped to cool the market,” the specialist explained.

• RIA News

• © Sergey Guneev

It should be noted that back in March, the dollar and euro rates on the Moscow Exchange for the first time rose above 121 and 132 rubles, respectively.

However, in mid-spring, the situation began to gradually stabilize due to the initiatives of the authorities, as well as changes in the conditions in foreign trade.

As a result, already in the summer, the national currency was able not only to fully win back the sanctions losses of the current year, but also to strengthen at a record high.

Now the dollar and euro are trading near 57-58 rubles.

At the same time, in June, the indicators briefly dropped to 50.01 and 52.7 rubles, respectively, the lowest values ​​in more than seven years.

“The panic subsided, and the Russians stopped buying foreign currency in huge volumes.

However, extending the restrictions looks like a logical step.

So far, we have no clarity on the restoration of imports, and individuals do not really need currency, as the number of trips abroad has seriously decreased.

However, I think as soon as the geopolitical situation calms down, the Central Bank will remove all remaining restrictions,” Ostapkovich suggested.

free walking

According to Elvira Nabiullina, Western sanctions have made it difficult for Russian banks to transfer and settle in foreign currency.

Against this background, credit organizations today are not interested in having foreign banknotes, and therefore they introduce various commissions for their customers.

“This is a forced measure.

It's not because they want to capitalize on it.

This is a consequence of the sanctions.

If the currency needs to be transferred, and this is done through a foreign correspondent account, and if the money hangs there, then this is a risk for customers, not to mention the bank itself ... These transactions have become very risky, ”explained the head of the Central Bank.

According to her, in the current environment, many credit institutions and companies are now actively transferring their money to safer and more reliable forms of assets.

We are talking not only about the ruble, but also about the currencies of friendly countries, Nabiullina noted.

At the same time, as the chairman of the Central Bank emphasized, the Russian authorities are not going to ban the circulation of cash dollars and euros in Russia.

“Even in the most apocalyptic, if I may say so, scenario, a complex scenario, cash dollars will circulate in our country.

I can only name one number.

According to our estimates, the population has about $85 billion in cash foreign currency - dollars and euros. Now banks can sell and buy this currency.

Therefore, here, of course, the circulation of cash will be, ”Nabiullina assured.