Elvira Nabiullina, head of the Central Bank, the direction of the Russian economy
“She has great confidence in the government and the president,” said Sofia Donets, an economist at Renaissance Capital in Moscow who worked at the central bank from 2007 to 2019. In recent years, it has been quite clear that all kinds of policy questions are being asked, and in the financial sphere the central bank has been empowered, she added.
This trust was built while Ms. Nabiullina was supporting the Russian economy against Western sanctions, especially from the long-term US sanctions. In 2014, the United States cut several major Russian companies from its financial markets. But these companies have had significant foreign currency debts, raising concerns about how their debts will be serviced.
The Russo-Ukrainian War and the Global Economy
long-range struggle. The Russian invasion of Ukraine had a ripple effect around the world, adding to the stock market problems. The conflict caused staggering gas price hikes and product shortages, and prompted Europe to reconsider its dependence on Russian energy sources.
Ms. Nabiullina set out to squeeze as many US dollars out of the economy as possible, so that companies and banks would be less at risk if Washington imposed more restrictions on the state’s use of dollars.
It also shifted the bank’s reserves, which grew to more than $600 billion, towards gold, the euro and the Chinese renminbi. During her tenure, the share of dollars in reserves has fallen to about 11 percent, from more than 40 percent, Ms Nabiullina told Parliament last month. She told lawmakers that even after the sanctions froze the bank’s foreign reserves, the country had “sufficient” gold and renminbi reserves.
Other safeguards against sanctions have included an alternative to SWIFT, the global banking messaging system, which has been developed in recent years. And the bank has changed the payments infrastructure to process credit card transactions in the country, so even the exit of Visa and Mastercard will have little impact.
In March, Bloomberg News and The Wall Street Journal reported, citing anonymous sources, that Ms. Nabiullina tried to resign after the invasion of Ukraine, and was rejected by Mr. Putin. The central bank rejected those reports.
Last month, the Canadian government imposed sanctions on her for being a “close partner of the Russian regime.”