Russia suspends dollar and euro trading on leading stock exchange

The Bank of Russia said that trading in the Moscow Exchange’s foreign exchange, precious metals and derivatives markets with settlements in these currencies had been suspended due to the US sanctions. However, foreign exchange trading in the OTC market – when two parties trade directly and without the supervision of an exchange – will continue.

The US Treasury Department imposed sanctions on the Moscow Stock Exchange and Russia’s central securities depository, which provides bank account services, registration of OTC transactions and liquidity management services.

“We are increasing the risk to financial institutions involved in Russia’s war economy and eliminating evasion opportunities. We are also reducing Russia’s ability to benefit from access to foreign technology, equipment, software and IT services,” US Treasury Secretary Janet Yellen said in a statement.

The Russian central bank said people could continue to buy and sell currencies through Russian banks and that deposits remained safe. Kremlin spokesman Dmitry Peskov said in a commentary to the Russian state news agency TASS that the central bank was able to ensure stability in all markets.

The Biden administration imposed sanctions on more than 300 companies and individuals on Wednesday in an effort to break up the networks with third countries through which Russia can procure technology and equipment for its war in Ukraine. China is particularly affected.

Officially, Beijing maintains a neutral stance in the Ukraine war. However, the country remains an economic lifeline for Russia. Deepening trade relations have helped Russian President Vladimir Putin to stabilize his economy despite Western sanctions.

The US State Department said the latest measures target seven companies based in China that have supplied goods to support Russia’s war in Ukraine, as well as companies based in Belarus and others based in the United Arab Emirates, Turkey, Kyrgyzstan, Moldova and Singapore that have supplied dual-use goods to Moscow.

Earlier this year, the Wall Street Journal reported that drones and U.S.-made computer chips were increasingly entering Russia from China via Central Asian trade routes that wind through former Soviet republics such as Kyrgyzstan.

Washington also imposed sanctions on companies involved in Russian energy projects, the metal and mining industries, as well as on manufacturers of Russian weapons systems and military components.

“Today’s actions attack their remaining sources of international supplies and equipment, including their dependence on vital supplies from third countries,” Yellen said.

Write to Mauro Orru at [email protected]