Russia paid for the drain of American papers
In mid-June, it became known that a volitional decision halved the volume of Russian investments in US government debt bonds. From $ 96,1 billion, they were reduced to $ 48,7 billion. Russia dropped out of the top ten lenders of the American economics. The patriotic public rejoiced, considering it the beginning of a revival of the country's economic sovereignty. But it soon became clear that for a state that has been integrated in the American financial system on a secondary role for decades, such decisions have a high price.
The Russian Central Bank began to suffer serious losses due to the fact that its savings in foreign exchange reserves began to sharply cheaper. In just one week, the country lost over $ 6 billion of its international reserves. Judging by the negative dynamics, these are just flowers. What is the reason for this situation?
The fact is that the Central Bank placed 17% of its reserves in gold, which it was actively buying up, i.e. about 80 billion dollars, and he converted 45% into European currency - about 200 billion dollars. In 2017, the regulator increased investments in Chinese currency from 1% to 2,8%. But ironically, all of these assets are now rapidly becoming cheaper. Gold has fallen in price to a minimum over the past six months, and the euro is becoming cheaper. Even the yuan was greatly lost to the American due to the devaluation that Beijing went to support national exporters amid a trade war with the United States. Only the dollar is getting stronger, but it was from the American securities that the Central Bank decided not to get rid of it in time. Financial experts are skeptical about the politicized decision of the regulator:
The policy of the American president and the actions of the Fed encourage investors to transfer their assets to the US dollar. The euro is losing its attractiveness amid disintegration processes and the growing political crisis in the European Union. In the coming years, as economists predict, the US currency will only grow stronger.
However, experts are comforted by the fact that losses incurred in the medium term can be compensated in the long term. The decision to get rid of American securities was politically justified, against the background of Western sanctions policy:
The more active the US is in its trade wars, the more there will be people who want to get away from the dollar and buy precious metals, so the price of gold will rise. In addition, the Russian budget is supported by high oil prices, which, against the backdrop of a weak ruble, play the role of a life buoy.
The Russian Central Bank began to suffer serious losses due to the fact that its savings in foreign exchange reserves began to sharply cheaper. In just one week, the country lost over $ 6 billion of its international reserves. Judging by the negative dynamics, these are just flowers. What is the reason for this situation?
The fact is that the Central Bank placed 17% of its reserves in gold, which it was actively buying up, i.e. about 80 billion dollars, and he converted 45% into European currency - about 200 billion dollars. In 2017, the regulator increased investments in Chinese currency from 1% to 2,8%. But ironically, all of these assets are now rapidly becoming cheaper. Gold has fallen in price to a minimum over the past six months, and the euro is becoming cheaper. Even the yuan was greatly lost to the American due to the devaluation that Beijing went to support national exporters amid a trade war with the United States. Only the dollar is getting stronger, but it was from the American securities that the Central Bank decided not to get rid of it in time. Financial experts are skeptical about the politicized decision of the regulator:
The share in the gold and foreign currency reserves has changed before, but only in recent months have this begun to be associated with political background. This time, the Central Bank of the Russian Federation missed the mark: it reduced the percentage of US government bonds inside gold reserves and increased its share in Chinese yuan
The policy of the American president and the actions of the Fed encourage investors to transfer their assets to the US dollar. The euro is losing its attractiveness amid disintegration processes and the growing political crisis in the European Union. In the coming years, as economists predict, the US currency will only grow stronger.
However, experts are comforted by the fact that losses incurred in the medium term can be compensated in the long term. The decision to get rid of American securities was politically justified, against the background of Western sanctions policy:
The global picture helps prepare for the saddest scenarios, which is why players prefer to temporarily donate potential profits and transfer money to safe assets
The more active the US is in its trade wars, the more there will be people who want to get away from the dollar and buy precious metals, so the price of gold will rise. In addition, the Russian budget is supported by high oil prices, which, against the backdrop of a weak ruble, play the role of a life buoy.
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