The US today cut off the Russian central bank and sanctioned its state investment fund as the West tightened its economic chokehold on Vladimir Putin – while ordinary Russians ran to cash machines to empty their deposits.
The move effectively prevents Americans from doing business with the bank, and will severely limit Russia’s ability to defend the ruble and prop up its economy. ‘Our strategy to put it simply is to make sure that the Russian economy goes backward as long as President Putin decides to go forward with his invasion of Ukraine,’ a US official told reporters.
Putin took another swipe at Western sanctions today during an emergency meeting with economic officials at the Kremlin. ‘I’ve invited you here to talk about issues to do with the economy,’ he told officials. ‘I mean of course the sanctions which the so-called Western community – the empire of lies – is trying to implement against our country.’
“We wanted to put these actions in place before our markets open because what we learned over the course of the weekend from our allies and partners was the Russian Central Bank was attempting to move assets and there would be a great deal of asset flight starting on Monday morning from institutions around the world,” the official said, on a conference call with reporters.
“Our strategy to put it simply is to make sure that the Russian economy goes backward. As long as President Putin decides to go forward with his invasion of Ukraine,” the official added.
The U.S. is also adding Kirill Dmitriev, another ally of Russian President Vladimir Putin, to the sanctions list as well as the direct investment fund Dmitriev heads. The Russian Direct Investment Fund, or RDIF, is officially a sovereign wealth fund but is widely considered a slush fund for Putin.
The official said the U.S. expects its allies to take similar steps in the coming days. This comes after the U.S. and its allies announced over the weekend that they will impose restrictive measures aimed at preventing Russia’s central bank from deploying its international reserves in ways that may undermine sanctions.
