{"id":235373,"date":"2021-06-04T06:11:59","date_gmt":"2021-06-04T06:11:59","guid":{"rendered":"http:\/\/www.thetruthseeker.co.uk\/?p=235373"},"modified":"2021-06-05T05:34:29","modified_gmt":"2021-06-05T05:34:29","slug":"russia-to-ditch-dollar-from-185bln-reserve-fund","status":"publish","type":"post","link":"https:\/\/www.thetruthseeker.co.uk\/?p=235373","title":{"rendered":"Russia To Ditch Dollar From $185Bln Reserve Fund"},"content":{"rendered":"

Moscow Times \u2013 June 3, 2021<\/strong><\/h1>\n

Russia\u2019s sovereign wealth fund will ditch its holdings in dollars, dramatically increase its holdings of Chinese yuan and invest in gold for the first ever time, Russia\u2019s Finance Ministry said<\/a> Thursday.<\/p>\n

Finance Minister Anton Siluanov told the St. Petersburg International Economic Forum (SPIEF) that Russia\u2019s $186-billion national welfare fund (NWF) would completely divest its $41 billion worth of holdings in dollars within a month.<\/p>\n

\u201cToday we have about 35% of NWF investments in dollars,\u201d Siluanov said. \u201cWe\u2019ve decided to get out of dollar assets completely, replacing investments in dollars with an increase in euros and gold.\u201d<\/p>\n

The share of euros in the fund will be increased to 40%, the Chinese yuan will account for 30% and another 20% will be stored in gold.<\/p>\n

The move will affect the liquid part of the NWF, which currently stands at around $120 billion. Despite the vast sums involved, the shift is unlikely to affect markets, since the NWF represents just a slice of Russia\u2019s overall $600 billion<\/a> worth of international reserves. The transaction will not involve the actual sale of dollars, as it will be carried out through internal transfers and an accounting shift within the Central Bank, Bloomberg reported<\/a>.<\/p>\n

First Deputy Prime Minister Andrey Belousov, one of the country\u2019s most influential economic policymakers, said Thursday the decision would not affect the ruble\u2019s exchange rate. The Russian currency was flat against the U.S. dollar at 73.2 on Tuesday afternoon in Moscow trading.<\/p>\n

Russia\u2019s Central Bank has also been reducing the share of U.S. dollars within its overall reserves over recent years, a policy which is set to continue, Kremlin spokesperson Dmitry Peskov said<\/a>, as Russia seeks to reduce its dependence on the greenback under the specter of possible new sanctions<\/a>.<\/p>\n

Renaissance Capital\u2019s Sofya Donets said the move was largely technical, and dubbed the decision \u201ca political declaration, rather than a necessary step.\u201d<\/p>\n

\u201cAlthough sanction risks are present, I assume that risks for the Central Bank\u2019s reserves kept in U.S. dollars are basically non-existent,\u201d she told The Moscow Times.<\/p>\n

The U.S. levelling sanctions against Russia\u2019s Central Bank would \u201cbe in conlift with the current international monetary settings \u2014 like a third world war.\u201d<\/p>\n

The NWF is where Russia stores excess profits on oil sold abroad. It is designed to help stabilize the highly volatile ruble from swings in global oil prices and serve as a store of potential cash which can be unleashed to fund infrastructure investments across the country.<\/p>\n

How exactly the fund should be used has been the focus of intense debate<\/a> in Russia over recent years. At the start of the coronavirus pandemic, economists called<\/a> for Russia to unlock the fund to roll out a more far-reaching stimulus program \u2014 though this was resisted by Siluanov, who said using the sovereign welfare fund for government transfers would undermine Russia\u2019s macroeconomic stability.<\/p>\n

The government is yet to decide on a course, with the most likely options being tapping into a small portion of the fund to support Russia\u2019s ambitious $360-billion National Projects package or providing development loans to countries that buy Russia\u2019s exports, analysts at Renaissance Capital said. They estimated that spending 0.5% of the NWF would boost Russia\u2019s annual GDP by 0.3%.<\/p>\n

Source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Russia\u2019s reserve fund will “completely” replace its investments in dollars with investments in gold and euros<\/p>\n","protected":false},"author":39262,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[66,91],"tags":[],"class_list":["post-235373","post","type-post","status-publish","format-standard","hentry","category-Economics","category-russia"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/235373","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/users\/39262"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=235373"}],"version-history":[{"count":2,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/235373\/revisions"}],"predecessor-version":[{"id":235375,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=\/wp\/v2\/posts\/235373\/revisions\/235375"}],"wp:attachment":[{"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=235373"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=235373"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thetruthseeker.co.uk\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=235373"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}