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US Targets Russia’s Central Bank in Latest Sanctions Action


US Targets Russia's Central Bank in Latest Sanctions Action

The US has blocked Americans from participating in any transactions involving Russia’s central bank

WASHINGTON:

On Monday, the United States blocked Americans from participating in any transactions involving Russia’s central bank, the National Treasury and the treasury to further punish Moscow for its invasion of Ukraine.

U.S. officials said on Monday fierce economic sanctions imposed by the United States and its allies on Russia’s central bank and other key sources of assets have could lead to higher Russian inflation, crippling purchasing power and reducing investment. .

The move comes after the United States and its allies last week imposed several rounds of sanctions targeting Moscow, including against Russian President Vladimir Putin and Russia’s biggest lenders, after the its forces invaded Ukraine.

“This is a vicious feedback loop triggered by Putin’s own choices and fueled by his own aggression,” said a senior US administration official.

Negotiations between Russian and Ukrainian officials began on the Belarusian border on Monday, as Russia faces deepening economic isolation four days after invading Ukraine in its biggest offensive yet. a European country since the Second World War.

The US Treasury Department in a statement on Monday said it had also imposed sanctions on Russia’s key sovereign wealth fund, the Russian Direct Investment Fund.

The United States and its allies vowed to take action against Russia’s central bank on Saturday, in a move that experts see as a significant escalation of Western sanctions on Moscow only. days after Russia invaded the neighboring country.

A second senior US official said the move “immobilizes” any assets Russia’s central bank holds in the US in a move that would hamper access to hundreds of billions of dollars in assets. of Russia.

“Putin’s $630 billion stockpile makes sense only if he can use it to protect his currency, namely by selling those reserves to make money,” the first official said. exchange for rubles”.

“After today’s action, that will be no more.”

The Treasury issued a general license along with Monday’s action allowing certain energy-related transactions through June 24.

The administration of President Joe Biden is concerned that its sanctions could raise already high gas and energy prices and has taken steps to mitigate that.

Officials on Monday also warned that the United States would not hesitate to increase the consequences against Russia and that they were also closely monitoring Belarus’s involvement, adding that Russia’s powerful ally could faced more consequences if it continued to aid Moscow during the invasion.



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