Yellen urges world leaders to 'unlock' frozen Russian Central Bank assets and send them to Ukraine
froze hundreds of billions of dollars in Russian foreign holdings in retaliation for Moscow’s invasion of Ukraine. Those billions have been sitting untapped as the war grinds on, now in its third year, while officials from multiple countries have debated the legality of sending the money to Ukraine. More than two-thirds of Russia’s immobilized central bank funds are located in the EU.
Using the assets to help Ukraine “would make clear that Russia cannot win by prolonging the war and would incentivize it to come to the table to negotiate a just peace with Ukraine," Yellen said. The idea of using Russia’s frozen assets has gained traction lately as continued allied funding for Ukraine becomes more uncertain and the U.S. Congress is in a stalemate over providing more support.
But there are tradeoffs since the weaponization of global finance could harm the U.S. dollar’s standing as the world’s dominant currency. Yellen said Tuesday that it is “extremely unlikely" that tapping the frozen funds would harm the dollar's standing in the global economy "especially given the uniqueness of the situation where Russia is brazenly violating international norms.
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