Vladimir vs Elvira: The battle on Russia’s financial front line

Despite that, Nabiullina reportedly failed to stress test the economic blow of war, having been blindsided by the decision to push ahead with the invasion.

Some have little sympathy for the trapped governor, arguing Putin has long been putting in place the pieces for a war, while others doubt the leaked resignation story.

Few women make it into Putin’s inner circle, while even fewer officials in the Kremlin manage to gain the respect of international investors. But Nabiullina had blazed a trail with her stewardship of the Russian economy.

Tim Ash, an emerging market strategist at BlueBay Asset Management, says: “The nature of the Putin regime was clear a year ago, five years ago, 10 years ago… we’ve had the Donbas, Crimea, [Sergei] Skripal, [Alexei] Navalny. They’ve had plenty of time to resign and they haven’t.

Nabiullina’s reputation is in “tatters” after helping the Kremlin since the invasion, he adds.

Few women make it into Putin’s inner circle, while even fewer officials in the Kremlin manage to gain the respect of international investors. But Nabiullina had blazed a trail with her stewardship of the Russian economy.

Liam Peach, an emerging market economist at Capital Economics, says: “She established a really strong reputation in Russia as an inflation hawk and a credible central bank governor.

“After the 2014-15 rouble crisis, she floated the rouble and she’s been at the forefront of the central bank’s efforts in recent years to clean up the banking system.”

The ex-Sberbank chief executive has managed to steer the Russian economy through crises including COVID-19, an oil price crash and previous waves of sanctions. But the war has undone much of her hard work to strengthen the country’s economy with the central bank itself hit by sanctions.

Now, amid the war, Nabiullina has been forced to double interest rates to 20 per cent, freeze trading on Moscow’s stock exchange and introduce capital controls – a move she was said to have privately claimed was a resigning red line.

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Peach says Nabiullina has been “very successful at preventing a liquidity and solvency crisis in the banking sector” and stopping foreign money leaving. Perhaps her place at the heart of Moscow’s economic war should be no surprise.

A central bank under Nabiullina was key in Putin’s Fortress Russia plan to cushion the blow of any future wave of Western sanctions. Since the annexation of Crimea, she built up a $US630 billion ($839 billion)) foreign reserves war chest to fight any slump in the Russian rouble, ammunition blunted by sanctions on the central bank.

Nabiullina has also stood by Putin through his increasing authoritarianism. She was an advisor to the president before her current role, and also served as his minister of economic development.

Reluctant or not, Nabiullina is on the front line – but it’s a role she’s fought for years.

Telegraph, London

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