Russians on the day of the military operation in Ukraine withdrew ₽111 billion in cash

Central Bank statistics: demand for cash on February 24 reached ₽111 billion, the highest since the beginning of the pandemic

The demand of the population and businesses for cash on February 24 jumped to the highest levels since the end of March 2020. Russians withdrew over 100 billion rubles from their accounts in a day, but this is 1.5 times lower than the surge in currency withdrawals at the beginning of the pandemic

On February 24, the volume of cash in circulation in Russia immediately jumped by 111.3 billion rubles, follows from the data of the Bank of Russia. This is a record surge since March 27, 2020 – then, against the backdrop of the start of the pandemic and after the proposal of President Vladimir Putin to introduce a tax on interest income from large deposits, the population and businesses withdrew cash for 174.9 billion rubles in a day. The statistics of the Central Bank include operations for receiving banknotes and banknotes through banks for the full day, but the data for February 24 also take into account the volume of cash withdrawals on the day off on February 23.

On the evening of February 21, Putin announced the recognition of the Donetsk and Luhansk People’s Republics. On February 22, as follows from the data of the Central Bank, the volume of cash in circulation increased by only 1.9 billion rubles. On the morning of February 24, Putin made an emergency address and announced the start of a military operation in the Donbass. After that, a collapse began on the Russian financial market: the ruble weakened sharply against major currencies, and the Moscow exchange stock index lost 33.3% (the maximum drop in history). Against this backdrop, the Bank of Russia started foreign exchange interventions — selling foreign currency on the market in order to satisfy the demand for it and ease the pressure on the ruble. Also, short sales (transactions with the aim of making money on price reductions) were prohibited in all markets.

Against this background, customers of large Russian banks in the first half of the day began to face problems when withdrawing cash from ATMs – queues or a shortage of banknotes in the devices, RBC wrote. Representatives of credit organizations argued that the lack of cash is not of a systemic nature, and ATMs are replenished in a timely manner.