The Central Bank gave recommendations to banks to stabilize the situation in the foreign exchange market

At the same time, the regulator stressed that currency swap transactions should not be a tool for financing foreign currency assets. The Central Bank emphasizes that this is an understandable stabilization mechanism for possible short-term surges in the domestic foreign exchange market.

The currency swap mechanism is used when the government supports banks and provides them with additional liquidity in foreign currency. In the case of the yuan, this measure has been in effect since January 19 last year. The transaction consists of selling yuan for rubles and then buying them back within one day, with the first part of the transaction being settled on the date of its conclusion and the second part on another business day.

The Central Bank reported that at the end of August, the Russian foreign exchange market experienced increased volatility and a weakening of the ruble against other currencies (by 1.8% against the yuan, by 5.6% against the US dollar). By the end of the month, the exchange rate returned to the level of early June 2024. The situation on the spot foreign exchange market remained fairly stable for almost the entire month, but at the end of August the spreads between bid and ask increased.

In the fourth quarter, the Central Bank of the Russian Federation will introduce quantitative restrictions on lending to consumers and borrowers with a high debt burden. This was announced by the Bank of Russia at the end of August.