Russia is increasing its reserves out of dollar assets and getting rid of us government bonds
Russia is increasing its reserves out of dollar assets and getting rid of us government bonds at the fastest pace since 2011, while buying gold with a maximum speed over the past 12 years. Although in the past year, the CBR increased its share of U.S. bonds in the reserves, now they are sold out of the Russian Central Bank.
In January of this year, Russia has reduced investments in securities of the U.S. government with 102,2 billion to 96,9 billion. The determination of further tightening monetary policy on the part of Powell, as well as uncertainty about trade wars and specific economic actions against our country, lead to a reassessment of country risk and liquidity of investments in securities of the United States. The influence of Russia can provide a variety of ways, but at the moment it is not necessary to test the sanity of the American authorities on strength, and the yield on the securities the further weakening of the dollar looks quite small.
In addition, the Central Bank followed the example of their Western colleagues and announced interest rate decision. To reduce by 0.25 b.p. there is little doubt, therefore, of 7.25% become a reality since 23 March. lower rates will provide additional opportunities to the economy and the real sector, will reduce the cost of loans and their maintenance, therefore, further fundamental strengthening of the ruble suggests the creation of reserves in projects within the country and other markets. The US market is all interesting for safe investment, but bond has lost its value, so the transfer of the reserves of these in more aggressive tools, and the ruble zone, the EU and Asia is the most effective measure for the period.
“International financial center”