Russian Central Bank Eases Capital Controls As Ruble Erases Losses

Now that the Russian ruble has erased all of its post-incursion losses…

…the Russian Central Bank decided on Friday that it would loosen restrictions on the transfer of funds abroad, much to the relief of ordinary Russians (particularly the wealthy, as well as the Middle class, who have increasingly been turning to the UAE, Israel and other locales as havens for their capital and assets).

CBR said it would allow Russians and non-residents from countries that don’t support sanctions to transfer up to $10,000, or its equivalent in another currency, each month.

Shortly after Russia’s “special military operation” began last month, Russia’s central bank tightened restrictions on money flowing abroad, barring non-Russians from transferring more than $5,000 a month out of the country.

Transfer limits will be determined using the CBR’s official exchange rates for the ruble against other currencies, the bank said.

Still, Russia will retain a tight grip on its currency market even with the easing of these capital controls. Russian brokerages still aren’t allowed to let foreign clients sell securities, one of a retinue of policies intended to support the ruble.

CBR has also restricted the amount of dollars that Russians can withdraw from bank accounts denominated in foreign currencies. Russian banks have been barred from selling foreign currencies to Russians until early September as the Russian banking system continues to face the repercussions of the seizure by the West of hundreds of billions of dollars’ worth of foreign-currency reserves held in accounts abroad.