Sharp Decline in Foreign Currency Deposits in Russia- Analysis

Non-ruble savings of Russian households have reached a 10-year low, according to Russia’s central bank. The amount of foreign currency in private accounts has been decreasing since last year and currently stands at $63.4 billion as of early November. This represents just 9.4% of total household savings. The current level of non-ruble deposits is the lowest since 2012 when the figure was $69.2 billion. Experts attribute this decline in foreign currency holdings to several factors, including the strengthening of the ruble and higher deposit rates. Some individuals are shifting their deposits from “toxic” currencies into the ruble, while others are transferring to the yuan or to banks outside of Russia. Since early 2023, there has been a significant outflow of foreign currency from bank accounts and deposits, with balances on such deposits declining by almost 40% ($36.4 billion) according to data from the central bank. In March, the Bank of Russia imposed restrictions on transfers to foreign banks for individuals in an effort to support the domestic economy and curb capital outflow due to Western sanctions.

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Non-ruble savings in Russia are currently at the lowest level they have been in over a decade, as confirmed by the country’s central bank. The share of foreign currency in private accounts has been steadily decreasing since the previous year and has now reached $63.4 billion as of early November. This accounts for only 9.4% of total household savings. This represents a significant decline compared to 2012 when non-ruble deposits amounted to $69.2 billion. Experts attribute this decrease in foreign currency holdings to several factors, including the strengthening of the ruble and higher deposit rates. Many individuals are choosing to shift their deposits from “toxic” currencies to the ruble, while others are opting to transfer their funds to the yuan or to foreign banks. Notably, there has been a substantial outflow of foreign currency from bank accounts and deposits since early 2023, with balances on such deposits decreasing by almost 40% ($36.4 billion), according to data from the central bank. It is worth mentioning that in March, the Bank of Russia introduced restrictions on transfers to foreign banks for individuals as a means of supporting the domestic economy and minimizing capital outflow resulting from Western sanctions.

Source: RT news: Foreign currency deposits plunge in Russia