Russian Banks Face Liquidity Shortage for Government Debt Purchases

A Sberbank executive has indicated that Russian banks lack sufficient ruble liquidity to purchase government bonds, complicating Moscow's efforts to finance its expanding wartime budget deficit. Approximately 2 trillion rubles ($25.2 billion) have been withdrawn from the banking system this year, creating a liquidity crunch. This situation increases pressure on the Central Bank to provide funds for government debt, especially after the Finance Ministry suspended bond auctions in July due to declining OFZ prices and rising yields.