US is levying sanctions against Russia’s central bank
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1 min read . Updated: 28 Feb 2022, 07:24 PM IST Moves are being coordinated with Europe and G-7 allies
WASHINGTON : The US is sanctioning Russia’s central bank to prevent the government from using its emergency reserve currencies to protect the economy from the Western pressure campaign, senior US officials said ahead of the opening of U.S. markets.
The sanctions should further stoke inflation as Russia’s central bank is blocked from using the dollars, euros and other foreign currencies in its reserves stockpile to stabilize the ruble, the officials said. The U.S.’s actions, coordinated with its European and other Western allies, are part of its broader effort to coerce the Kremlin to abandon its violent invasion of Ukraine.
“ ‘Fortress Russia’ " will be exposed as a myth," said one of the officials, referring to Moscow’s efforts in recent years to bolster its economy against Western sanctions, including a $630 billion war chest of reserves at its central bank.
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The sanctions also target another major government stockpile of assets, a key sovereign-wealth fund called the Russian Direct Investment Fund, and prevent Moscow from using other government and private banks to manage central bank operations, the officials said. The U.S. is carving out exemptions for energy payments to cushion the European and global economies against the inflation that would result from cutting off exports from one of the world’s top oil and natural gas providers.
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