The head of the Bank of Russia Elvira Nabiullina suggested that the role of the dollar in both the Russian and global markets remains great, but interest in it will decrease over time, RBC reports.
Nabiullina stressed that the Central Bank regularly discloses information on the structure of gold and foreign exchange reserves (gold reserves). She said that the dollar decreased not only through the National Wealth Fund, but also in general in gold and foreign exchange reserves. In 2018, the structure of gold and foreign exchange reserves changed significantly, as well as the share of the dollar decreased due to the dollar’s economic, financial, geopolitical and sanctions risks.
The head of the Central Bank predicted the fate of the dollar, saying that interest in it would fall in favor of other currencies, including the euro. The share of such contracts is already increasing. “And this, accordingly, will gradually affect the structure of demand in the foreign exchange markets. Not only in Russian, maybe, but also globally, ”she said.
However, this process is unlikely to happen quickly, since such things do not happen abruptly, “requiring many years and trust in other reserve currencies.” “Many people say, and perhaps there is some fairness in this, that European financial markets are not as liquid as the dollar markets, not to mention other reserve currencies,” Nabiullina concluded.
In the same interview, Nabiullina predicted the peak of inflation. In her opinion, the rise in prices in annual terms in Russia will peak in the current September.