Russia eases rules on using rainy day fund to buy stocks, bonds

Russian rouble cash are seen on this illustration taken, February 24, 2022. REUTERS/Dado Ruvic/Illustration

MOSCOW, March 4 (Reuters) – Russia’s parliamenton Friday handed a legislation that makes it simpler for the federal government to make use of the nation’s Nationwide Wealth Fund (NWF) to purchase shares of Russian corporations and authorities bonds as an anti-crisis measure.

In search of methods to help markets harm by Russia’s invasion of Ukraine and Western sanctions, authorities are planning to spend the NWF cash on shopping for Russian securities in a transfer just like what they did in 2014 when Russia annexed Crimea.

The brand new legislation permits the wet day fund for use to purchase shares and bonds even when its liquid portion drops under 7% of gross home product (GDP).

The federal government is presently solely permitted to spend cash from the fund when its liquid property exceed 7% of GDP, however Russian authorities are scrambling to restrict the harm carried out by unprecedented Western sanctions.

The parliament, known as the Duma in Russian, stated the eased necessities have been a part of a set of legal guidelines designed to make the Russian economic system and households extra resilient within the face of sanctions.

As of Feb. 1, the liquid property of the NWF stood at $112.7 billion, or 8.8 trillion roubles, equal to six.6% of GDP projected for this yr. learn extra

Russia calls its actions in Ukraine a “particular operation” that it says just isn’t designed to occupy territory however to destroy its southern neighbour’s navy capabilities and seize what it regards as harmful nationalists.

Reporting by Reuters in Moscow; modifying by John Stonestreet and Jason Neely

: The Thomson Reuters Trust Principles.