The European Union, U.S. and other Western nations on Saturday announced they would cut off a “certain number of Russian banks” from the SWIFT international payments system and impose restrictions on Russia’s Central Bank.
Why it matters: The measures will effectively cut Russia out of the world’s most important financial messaging system and undermine the Kremlin’s ability to use its central bank reserves to blunt the impact of other sanctions.
- Ukrainian officials had demanded that Western allies cut Russia from SWIFT in response to the invasion and make the country a complete international and financial pariah.
- Some European allies like Germany and Italy had previously expressed concern that disconnecting Russian banks’ access to SWIFT would cause collateral economic damage, but agreed to take the step after public pressure and days of intensive meetings.
- On Sunday, Japan announced they would also block certain Russian banks from the SWIFT system, per Reuters.
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