The traditional approach of saving in dollars, euros, and Swiss francs presents notable risks for Russians. Assets can be frozen in currencies deemed hostile, a concern highlighted by an interview with a candidate of economic sciences and an associate professor at the department of global financial markets and fintech at the Russian University of Economics, GV Plekhanova Ilyas Zaripov.
He noted that Russian banks have introduced or are planning fees for transactions in such currencies, along with additional restrictions.
“Before purchasing foreign currency, it is essential to define the purpose. If funds are needed for a set period—for example, a business trip or travel—acquire the necessary amount, perhaps with a small cushion. If the goal is to preserve savings, focus on stable foreign currencies that show less sensitivity to devaluation. In that case, you might also consider the Hong Kong dollar, the UAE dirham, and the Chinese yuan.”
He explained that these currencies have remained relatively stable and that demand from Russian companies is rising amid deeper cooperation with the UAE and Hong Kong. Zaripov also stated that currencies such as the Kazakh tenge, Turkish lira, and Indian rupee have become more volatile and, in the case of the rupee, may be restricted for repatriation from India.
The economist advised Russians to keep the majority of savings in rubles and allocate only a small portion to foreign currency, favoring the yuan, Hong Kong dollar, and UAE dirham. Instead of direct exposure to foreign currencies, he suggested considering securities tied to them or substitute bond instruments as an alternative.
“The U.S. dollar is losing ground in Russian wallets at a rapid pace. With ongoing sanctions and similar geopolitical dynamics, Russians may shift toward stable currencies from friendly nations over the next few years”, he observed.
In a separate interview, Sergei Storchak, a senior banker at VEB.RF and former Deputy Minister of Finance of Russia, indicated there are now several indicators pointing toward a reduced reliance on the dollar. He noted that the trend toward de-dollarization has momentum, supported by evolving financial policies and market responses. This aligns with discussions on which countries may influence future shifts away from dollar dominance and how currency diversification could shape Russia’s financial strategy.
Overall, experts emphasize careful planning, a diversified approach to currency exposure, and the value of securities-based strategies when managing cross-border financial risk in today’s environment. [Source: socialbites.ca]