Russia Central Bank Denies Plans to Freeze Deposits
The Central Bank of Russia issued a firm denial Monday regarding circulating rumors about potential freezes on private bank deposits, as concerns mount over the nation’s economic stability.
“Such a move would severely undermine the banking system and financial stability,” the monetary authority said on Telegram, addressing widespread public inquiries that followed its recent aggressive interest rate increase to 21%.
The speculation reflects deepening public anxiety about Russia’s financial system as the country faces multiple economic challenges. President Vladimir Putin has acknowledged inflation’s impact, while basic food items including dairy products have seen substantial price increases, with inflation reaching nearly 9% in November.
Central Bank Governor Elvira Nabiullina, who previously rejected similar concerns during a parliamentary inquiry last November, maintains that deposit restrictions would be incompatible with market economics.
Despite international sanctions, Russia has sustained its economy through increased military expenditure and by developing trade relationships with Asian partners, particularly China and India. However, the central bank has cautioned about potential economic overheating amid a weakening currency and workforce shortages.
A Swedish economic analyst warned Tuesday that Russia’s financial reserves could be depleted by year-end, potentially compromising both its military operations and economic stability as the Ukraine conflict approaches its fourth year.
The high interest rates have attracted significant deposits into Russian banks, contributing to public concern about account accessibility. However, the central bank emphasized that restricting access to private savings would be “unthinkable” in any functioning market economy.
The monetary authority stressed that such actions would violate citizens’ fundamental rights to manage their assets, seeking to calm depositors’ fears amid ongoing economic uncertainty.
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