Russians move into cash again

The volume of cash in circulation has exceeded RUR 15 trn amid the partial mobilization campaign announced in Russia, the Central Bank reported adding that this has happened for the second time in recorded history.

Over the past month, the amount of cash held by Russians jumped by RUR 930 bln to 15.1 trn ($246.4 bln). The previous absolute record was set after the launch of the special military operation in February, when people cashed out a total of 15.8 trn ($257.9 bln).

Russians are seeking refuge from the growing uncertainty in cash, the mega-regulator’s press office explained. However, they still use part of their cash to pay for goods and services instead of non-cash transactions, so in any case, the money flows back into credit institutions.

“The trend observed does not pose a threat to the Russian banking system’s stability,” economist Dmitry Afanasyev said. “We believe senior citizens still mostly prefer keeping their money in bank accounts, so a sharper fall is unlikely unless new political risks arise.”

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