500 foreign companies have pulled up stakes in Russia, scaled back operations and investment, or pledged to do so.

“Russia does not have the capabilities to replicate domestically the technology that it would otherwise have gained from overseas,” according to an analysis by Capital Economics, a research group based in London. That is not a good sign for increasing productivity, which even before the war, was only 35 to 40 percent of the United States’.

The result is that however the war in Ukraine ends, Russia will be more economically isolated than it has been in decades, diminishing whatever leverage it now has over the global economy as well as its own economic prospects.

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Western Sanctions Aim to Isolate Putin by Undermining the Ruble

By targeting Russia’s central bank with sanctions, experts said, American and European leaders have taken aim at what could be one of President Vladimir V. Putin’s greatest weaknesses: the country’s currency.

In Russian cities, anxious customers started lining up on Sunday in front of A.T.M.s, hoping to withdraw the money they had deposited in banks, fearful it would run out. The panic spread on Monday. To try to restore calm, the Bank of Russia posted a notice on its website: “The volume of bank notes ready for loading into A.T.M.s is more than sufficient. All customer funds on bank accounts are fully preserved and available for any transactions.”

Even before the sanctions were announced over the weekend, the ruble had weakened. On Monday it plunged further, with the value of a single ruble dropping to less than 1 cent at one point. As the value of any currency drops, more people will want to get rid of it by exchanging it for one that is not losing value — and that, in turn, causes its value to drop further.

In Russia today, as the purchasing power of the ruble drops sharply, consumers who hold it are finding that they can buy less with their money. In real terms, they become poorer. Such economic instability could stoke popular unhappiness and even unrest.

nuclear forces on a higher level of alert. The United States, the European Commission, Britain and Canada agreed to remove some Russian banks from the international system of payments known as SWIFT and to restrict Russia’s central bank from using its storehouse of hundreds of billions of dollars’ worth of international reserves to undermine the sanctions.

Kicking banks out of SWIFT has gotten the most public attention, but the measures taken against the central bank are potentially the most devastating. Ursula von der Leyen, the president of the European Commission, said it would “freeze its transactions” and “make it impossible for the central bank to liquidate its assets.”

On Monday, the U.S. Treasury Department offered more details on how the sanctions would work, saying they would paralyze the Bank of Russia’s assets in the United States and stop Americans from engaging in transactions involving the central bank, Russia’s National Wealth Fund or the Russian Ministry of Finance. As expected, there are exemptions for transactions related to energy exports, on which Europe relies.

British government banned transactions with the Russian central bank, the foreign ministry and the sovereign wealth fund.

But if the allies were to impose a full-fledged freeze of the vast amount of dollars, euros, pounds and yen that are owned by Russia but held in Western banks, it could devastate the Russian economy, causing spiraling inflation and a severe recession.

At the heart of the move to restrict the Bank of Russia are its foreign exchange reserves. These are the vast haul of convertible assets — other nations’ currencies and gold — that Russia has built up, financed in large part through the money it earns selling oil and gas to Europe and other energy importers.

Lenin himself reportedly made more than a century ago, which was repeated by the economist John Maynard Keynes: “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency.”

The Bank of Russia can try to prop up the value of the ruble by using its reserves to buy up rubles that people are selling. But it can do that only as long as it has access to foreign reserves.

dizzying spikes in prices for energy and food and could spook investors. The economic damage from supply disruptions and economic sanctions would be severe in some countries and industries and unnoticed in others.

Yet the central bank has just about $12 billion of cash in hand — an astonishingly small amount, he said. As for the rest of Russia’s foreign exchange reserves, roughly $400 billion is invested in assets held outside the country. Another $84 billion is invested in Chinese bonds, and $139 billion is in gold.

took steps on Monday to restore confidence, and more than doubled interest rates to 20 percent from 9.5 percent in order to offset the rapid depreciation of the ruble. The bank also released an additional $7 billion worth of reserves that had been set aside as collateral for loans and closed down the Moscow stock exchange for the day. Meanwhile, the foreign ministry moved to order companies to sell 80 percent of their foreign currencies, in a bid to gin up demand for rubles and prevent them from stockpiling dollars and euros.

Mr. Bernstam warned that the West’s attack on the Russian ruble needed to be handled with care. “We don’t want to destroy them,” he said. “We don’t want the political system to collapse.”

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Biden Sanctions on Russian Debt Called a ‘First Salvo’ That Send a Message

The Biden administration on Thursday barred American banks from purchasing newly issued Russian government debt, signaling the deployment of a key weapon in Washington’s intensifying conflict with Moscow — threatening Russia’s access to international finance.

The curbs on debt were part of new measures against Russia that primarily involved sanctions on dozens of entities and individuals and the expulsion of 10 diplomats from the Russian embassy in Washington. The moves aim to exploit Russia’s weak economy to pressure Moscow to relent in its campaign to disrupt American political life and menace Ukraine. The limits on debt purchases, which apply to bonds issued by the Russian government after June 14, could raise the cost of borrowing within the Russian economy, limiting investment and economic growth.

For now, that threat remains minuscule. Russian government debt held outside the country amounts to about $41 billion, according to the Russian central bank — a relative pittance in the global economy. For comparison, the U.S. Treasury issued a total of $274 billion in sovereign debt over the first three months of this year alone.

Russia’s government sells most of its debt domestically, and it finances much of its operations through the sale of energy. American investors hold only 7 percent of Russian government debt denominated in rubles, according to Oxford Economics in London.

European business interests seek access to the potentially vast Iranian marketplace. Russia, by contrast, is a major supplier of energy across Western Europe. Russia sits on the region’s doorstep, making European leaders — especially Germany — loath toward greater conflict.

Limiting Russia’s access to the international bond markets amounts to “nibbling around the edges,” said Simon Miles, a Russia expert at Duke University. A meaningful hit would threaten Russia’s market for natural gas in Western Europe.

severed Iran from the global financial system, something Washington could bring about given that the American dollar is the world’s reserve currency, the means of exchange in transactions around the planet. Any bank anywhere on earth that handled business for Iran risked being cut off from the international payment network and denied access to dollars.

Russia has very limited need to borrow money from abroad, having cut its deficits sharply following sanctions that were imposed after its annexation of Crimea in 2014.

“We’ve had a period of austerity, fiscal austerity, ever since that sanctions shock,” said Elina Ribakova, deputy chief economist at the Institute of International Finance, a trade association representing international banks. “They prepared themselves.”

Thursday’s order on Russian debt applies only to American financial institutions, but it could prompt multinational companies beyond the United States to recalculate the risks of transacting with the Russian government.

“It puts them on notice, if you like,” said Mr. Nixey. “Every company that is significantly in Russia is listening to this very, very carefully and wondering if it is a good idea, reputationally or in terms of political risk, whether they should continue doing business at the same volume that they are.”

Andrew E. Kramer contributed reporting from Moscow.

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