At the Moscow Financial Forum, Sergei Shvetsov, who chairs the Moscow Stock Exchange’s Supervisory Board, issued a warning about the potential risks tied to overusing currency regulation tools. RBC reported his remarks. The central idea was clear: tighter foreign exchange controls can create inefficiencies and distort market signals if relied on too heavily.
Shvetsov spoke about currency regulation as a tool that should address concrete tactical challenges, not become a blanket strategy. He noted that there has been ongoing research in this area and that a single, uniform regulatory norm has not held for more than six months in recent times. His point underscored the dynamic nature of currency markets and the dangers of static policy when financial conditions shift rapidly.
According to him, prolonged restrictive measures tend to reduce market transparency and erode competition. He warned that misusing currency regulation is dangerous and that, more importantly, such measures often fail to produce lasting results. This perspective comes from a former deputy governor of the Central Bank, who emphasized that policy must adapt to evolving market realities rather than rely on a one-size-fits-all rule.
Earlier in the year, the Central Bank’s leadership signaled similar concerns about the limited effectiveness of heavy-handed currency controls. Elvira Nabiullina, the bank’s president, highlighted that businesses will inevitably identify loopholes, diminishing the impact of regulatory efforts over time. Nabiullina also urged a cautious look back at experiences from the late 1990s and early 2000s, suggesting that the longer such controls remain in place, the less effective they become.
In a related stance, the Central Bank has previously opposed a segmentation approach to the foreign exchange market that mirrors some elements seen in other economies. The discussion around segmentation touches on how best to balance liquidity, price discovery, and risk management in a way that serves both domestic stability and global competitiveness. These discussions are closely watched by economists and policy makers in North America and across the world, as they illuminate how different regulatory philosophies shape cross-border trade and investment decisions. [attribution: Moscow Financial Forum coverage], [attribution: Central Bank statements], [attribution: RBC report].