Russian rubles and coins (Pixabay)
(FORTUNE) – Russia's central bank has been stockpiling foreign reserves ever since Russia last invaded Ukraine, when President Vladimir Putin annexed Crimea in 2014. Since then, Russia's holdings of foreign currency and gold have almost doubled, ballooning to $630 billion today from $368 billion seven years ago.
Building foreign reserves could have been a way for the Kremlin to guard Russia's economy against sanctions, by giving the central bank more ammunition to protect the value of the ruble. The ruble lost half its value against the U.S. dollar after Russia annexed Crimea, forcing Russia's central bank to spend $130 billion to stabilize the currency.
Except it turns out that Russia’s foreign reserves strategy had a major flaw: About half of the money was held overseas in foreign banks – and now Russia can’t get to it.
The post Banks are stopping Putin from tapping a $630 billion war chest appeared first on WND.
