Russians are withdrawing billions from banks in the country in panic that Vladimir Putin could seize assets if cash is needed to pay for his war against Ukraine.
The first two weeks of August saw the volume of cash in circulation rise by 286.4billion roubles, or £2.5billion, per The Washington Post.
Every working day of August has seen Russian banks bleed cash, with the highest outflow of 56.8billion roubles, or £491.9million, recorded on August 12, according to central bank data.
It came after a record financial outflow of money in July, when more than 620billion roubles, the equivalent of around £5.4billion, were withdrawn.
This marks an outflow from the Russian banking system for a seventh consecutive month, according to central bank data.
This comes after rumours spread across Russian Telegram channels about a potential freeze on Russians’ bank deposits.
Russians are also increasingly feeling the effects of Putin’s invasion of Ukraine as Kyiv continues to launch drone attacks against Moscow’s oil refineries and other economic targets.
The surge in cash demand has drained banks’ rouble liquidity, prompting the Central Bank of Russia to expand lending to the banking sector.
These setbacks have left many banks without enough cash to purchase government bonds.
Large companies are also moving funds abroad to protect their assets from potential seizure by Russian regulators.
