Russia Dumping Dollars To Use To Protect Currency And Falling Oil Prices
By Kenneth Schortgen Jr Finance Examiner
As the United States expands its proxy war against Russia and the BRICS nations through a newly discovered secret deal with Saudi Arabia to force down global oil prices, Russia is firing back to this monetary attack against their currency and economy.
On Oct. 10, a new report on Russian currency outflows shows that during the third quarter ending in September, the Eurasian state paid off a near record $53 billion in foreign debt, and sold off dollars to use as capital to stabilize their declining currency, and to protect their primary resource industry from the deflation America has caused through the dumping of excess oil into the market supply.
Despite the reassuring narrative from The West that Russia faces "costs" and is increasingly "isolated" due to sanctions for its actions in Ukraine, the most recent data suggests reality is quite different.
First, capital outflows slowed dramatically in Q3 (from $23.7 billion in Q2 to $13 billion in Q3) with September seeing capital inflows for the first time since Sept 2013.
Second, Russia's current account surplus was significantly stronger than expected ($11.4 billion vs $8.8 billion expected) driven by increased trade.
Third, and perhaps most crucially, Russia paid down a massive $52.8 billion in foreign debt as Putin "de-dollarizes" at near record pace, reducing external debt to the lowest since 2012. - Zerohedge
Russia is not the only Eurasian nation de-dollarizing at a fast pace. Earlier this week as well, long time U.S. economic ally South Korea disseminated that their foreign reserve holdings had grown in the Yuan over the past year, almost doubling its prior total of 13.7% which was the amount they held at the end of 2013.
These reserves replace former dollar holdings, and rise a huge red flag that the Far Eastern manufacturing center is quickly moving into the Eurasian Trade camp, and away from Western hegemony.
America's gambit to force down the price of oil is a ploy the U.S. used in the late 1980's to destroy the Rouble, and tear down the old Soviet Union's economy.
However, the Russian leadership is not stupid, and have realized for a long time that this was an Achilles Heel in their economic system, and this time, the tables are quickly turning against the U.S. as Russia simply dumps more and more dollars to use as capital to supplement their currency and industry during these short term attacks by the West in their attempt to cripple them monetarily.
Russia dumping dollars to use to protect currency and falling oil prices