Russian President Vladimir Putin looks to peg the ruble to gold

Russian President Vladimir Putin is discussing the idea of pegging the rouble to gold and other goods, the Kremlin said on Friday, a move that if approved would directly link Russia's currency to bullion for the first time in more than a century.

A powerful Russian security official said this week linking the rouble to bullion could give Russia more "sovereignty" over its financial system, which has been battered by Western sanctions since Moscow sent troops into Ukraine on February 24.

Asked about the idea on a conference call with reporters, Kremlin spokesman Dmitry Peskov said “this question is being discussed with Putin”.

However, the governor of Russia's central bank, Elvira Nabiullina, told reporters the idea was “not being discussed in any way”. Russia produces around 10 per cent of the gold mined globally each year and is a major producer of oil, gas, metals and grains.

In what some saw as an attempt to link the rouble with gold, Russia's central bank said in March it would buy gold at a fixed price of 5,000 roubles a gram until June 30. But two weeks later, after the rouble had strengthened sharply, it backtracked and said it would buy at negotiated prices.

Many currencies have in the past been pegged to gold or silver. Russia adopted the gold standard in 1897 but, like many countries, abandoned it during the First World War as governments printed money to finance the conflict.

Rouble hits 2-year high vs €

The Russian rouble rose to a more than two-year high against the euro on Friday, supported by capital controls as the central bank slashed interest rates by 300 basis points to 14 per cent.

Putin, Zelenskyy to be at G20 meet: Jakarta
 

Indonesia's President Joko Widodo claimed that both Ukrainian President Volodymyr Zelenskyy and Russian President Vladimir Putin have agreed to attend the G20 summit to be held in Bali in November. Widodo, the current chair of the G20 group, made the remarks in a televised statement on Friday in which he said that he had telephone conversations this week with Zelenskyy and Putin. (AP/PTI)

Russia avoids $-bond default

Russia made what appeared to be a late u-turn to avoid a default on Friday, as it made a number of already-overdue international debt payments in dollars despite previously vowing they would only be paid in rubles. Russia's finance ministry said it had managed to pay $564.8 million on a 2022 Eurobond and $84.4 million on a 2042 bond in dollars - the currency specified on the bonds.

(Reuters)