Page 80 - RusRPTSept22

5.2.4 Gross international reserves
Russia’s international reserves dropped by $7.2bn or by 1.3% over the week and amounted to $566.8bn as of August 26, 2022, the Central Bank said on Thursday.
"The amount of international reserves as of August 26 totaled $566.8bn, having declined over the week by $7.2bn or by 1.3% under the effect of negative revaluation," the regulator said.
Reserves equaled $574bn as of August 19 of this year.
Russia’s international reserves are highly liquid foreign assets available with the Bank of Russia and the Russian Government. They comprise foreign currency, Special Drawing Rights (SDRs), a reserve position in the International Monetary Fund and monetary gold. The target level for international reserves set by the Central Bank of Russia is $500bn.
Russia’s reserves appear to have fallen heavily since the start of the war.
The Yale report estimated that Russia’s reserves have fallen by $75bn since the start of the war. But the statistics are deceptive.
The CBR itself quotes its GIR in terms of dollars, but the regulator has been de-dollarizing its reserves for several years in the run up to the war. The last time it reported, the CBR said that dollars only made up 11% of its total basket, of which 6.6% of the total was held in the US and is now presumably frozen.
The bulk of the reserves are held in currencies including the euro, pound sterling and yuan. The dollar has been on a tear this year and appreciated by around 10%. At the same time the other currencies have weakened on their own account. That means after revaluing Russia’s reserves for the FX effects and the dollar value is down by around $50bn in dollar terms – the bulk of the reduction in the value of Russia’s reserves are due to FX, not spending.
In August the CBR said it was thinking of buying $70bn worth of currencies from “friendly” countries as it continues to rebalance its reserves to reflect the realities of the sanctions regime.
Switzerland follows EU sanctions against Russian gold. The Swiss government imposed further sanctions against Russia on Aug. 3, following the EU's latest measures. "The new measures primarily concern a ban on buying, importing, or transporting gold and gold products from Russia," the statement reads. New sanctions also target Russia's largest bank, Sberbank, assets. The government said it made two exceptions concerning transactions related to agricultural products and oil supplies to third countries, as has the EU, "to avoid disruption to payment channels."
80 RUSSIA Country Report September 2022 www.intellinews.com