Russian financial markets turned upward on Friday, December 5, after the country’s Central Bank removed cross-border withdrawal limits for citizens of Russia and friendly states, a decision it attributed to improved stability on the currency market. The announcement sparked a swift rebound across equities and government bonds, reversing a week of negative sentiment.
Moscow Exchange Index Rises Above 2,700
The Moscow Exchange Index climbed past the 2,700-point mark for the first time since November twenty-fourth, reaching an intraday high of 2,707 points. The rally also extended to fixed-income markets, where the index of Russian government bonds jumped to 118.4 points, its highest level since mid-September.
The Central Bank stated that the decision followed a period of significant currency strengthening, with the ruble reaching its strongest level in more than two and a half years against the dollar. Officials described the move as a natural response to “a stabilized and more predictable foreign-exchange environment.”
Restrictions Remain for Citizens of Unfriendly States
While the new rules expand freedom of movement for capital held by Russian nationals and residents of friendly countries, several limits remain in place for citizens of unfriendly states working in Russia. Their ability to repatriate earnings remains capped, and the existing prohibition on transfers abroad for those living outside Russia continues unchanged.
Corporate transfers from companies registered in unfriendly jurisdictions also remain restricted, except in cases where such firms are controlled by Russian nationals or residents of friendly countries.
Market Rebound Follows a Week of Declines
The upbeat market reaction came after several sessions of losses triggered by disappointment over the outcome of recent talks between a U.S. delegation and Russian President Vladimir Putin. Both sides issued only minimal public statements after the meeting, prompting investors to infer that discussions had not produced tangible progress on the conflict in Ukraine.
This lack of clarity weighed on sentiment through much of the week. Friday’s policy shift, however, provided markets with a fresh signal of confidence from monetary authorities, helping to stabilize expectations heading into the final stretch of the year.
