Russia could reintroduce compulsory sale of FX revenues 'at any moment'

The need to reintroduce stringent capital controls comes as Russian authorities grapple with a sharply weakening rouble, which tumbled past 100 to the dollar on August 14.

Russian authorities are discussing bringing back the compulsory sale of foreign currency revenues for exporters, four sources familiar with the matter told Reuters, with one high-level source saying that the change could be made "at any moment".

The need to reintroduce stringent capital controls comes as Russian authorities grapple with a sharply weakening rouble, which tumbled past 100 to the dollar on Monday. An emergency 350-basis-point rate hike by the central bank on Tuesday seems to have only slowed the currency's slide.

Three sources said authorities were discussing the forced conversion of FX revenues by exporters, a measure adopted shortly after Russia sent troops into Ukraine in February 2022.

The high-level source hinted that the move was imminent, in spite of the fact that part of Russia's export revenues are now in roubles and Indian rupees, a consequence of Moscow seeking to move away from what it considers "unfriendly" Western currencies.

Russia has been supplying India with cheap oil. Russia’s RBC daily quoted the head of an India industry confederation as saying that a significant amount of trade between India and Russia is conducted in rupees, with mechanisms for settlement in roubles being explored.