Russia reels from sanctions as Putin calls West ’empire of lies’

Russia reels from sanctions as Putin calls West ’empire of lies’

MOSCOW/WASHINGTON:The ruble collapsed yesterday, Russians sought to withdraw their savings and a prominent tycoon urged an end to “state capitalism” in Russia as the country reeled from the effects of Western sanctions over the Kremlin’s invasion of Ukraine.

The United States yesterday banned all US transactions with Russia’s central bank effective immediately, the Treasury Department said as it unveiled an unprecedented sanction to further punish Moscow for invading Ukraine. “This action effectively immobilizes any assets of the Central Bank of the Russian Federation held in the United States or by US persons, wherever located,” the Treasury said of the measure taken in coordination with Western allies.

It will severely limit Russia’s ability to defend the ruble and prop up its economy. This new move, along with others taken by US allies, will make it hard for the Russian central bank to use its vast reserves of hard currency to buy rubles.

President Vladimir Putin raged against the West as he convened a meeting with officials including central bank chief Elvira Nabiullina and the CEO of Russia’s largest lender Sberbank, German Gref, to address what the Kremlin called a new “economic reality”.

“The Western community, which I called ‘the empire of lies’ in my speech,