MOSCOW, April 12. /TASS/. The restructuring of Russian contractors in foreign trade, as well as sanctions restrictions, bring about changes in the currency structure of payments towards currencies of friendly countries, according to the ‘Review of the Russian Financial Sector and Financial Instruments’ released by the Bank of Russia on Tuesday. Meanwhile, contracts are still often nominated in US dollars and euro, whereas payments are converted into currencies of friendly countries, which as a whole may increase residents’ currency risks, the review said.
"It will hardly be possible to abandon the use of US dollars or euro without import contracts being shifted to payments in rubles or friendly countries’ currencies. Due to the fact that most import contracts are still concluded with suppliers from unfriendly countries, a certain volume of currency resources on the domestic market will remain required, whereas the shift of payments towards friendly currencies will depend on the readiness and wish of foreign contractors of Russian companies," according to the review published by the Central Bank’s Research and Forecasting Department.
Amid the current environment the US dollar and euro are usually preferable currencies for exporters from friendly countries as well. This means that the demand for unfriendly countries’ currency will persist for the Russian economy, analysts said, adding that it might gradually decrease in the event of import substitution developing in the mid-and long-term.
Moreover, if the volume in US dollars and euro available for purchase by importers for rubles goes down on the Russian foreign currency market, the gap in the volume of unfriendly countries’ currencies in certain cases may be filled through purchases of those currencies for yuan. However, it extends the chains of foreign currency transactions and increases the risks of payment processing depending on Chinese banks’ readiness to boost transactions with Russian participants (fear of secondary sanctions), and it may also push prices of imported goods up, the review explained.
The analysis reflects the author’s personal standing. The contents and results of the analysis should not be viewed as the official position of the Bank of Russia, according to the document.