(Reuters) – The dollar’s role as a global currency is in decline after central banks rethink strategies following the West freezing Russian reserves. Russia’s central banking said Tuesday that it may consider imposing negative interest rates on dollar deposits and euros.

The unprecedented Western sanctions against Russia have frozen half its gold and forex assets. They stood at close to $640 billion when Moscow launched what it called a “special military operations” in Ukraine.

According to Russia’s Bank of Russia this precedent, along with discussion about the possible seizure of frozen reserves, will encourage other central banks, particularly in Asia and Middle East, not only to review their saving strategies, but also discuss the possibility of a potential seize of those assets.

In a report about financial stability, the Russian central banking stated that one could anticipate an increase in demand of gold as well as a decrease in U.S. dollars’ and euro’s roles in reserve assets.

The Russian central bank had $131.5 billion in its gold reserves as of 2021. $612.9 million of those reserves were held in foreign currencies. Russia’s current reserves were $583.4 million as of May 20, 2021.

Central bank stated that foreign currency has fallen in Russian banks’ obligations, as more clients withdraw money from their forex accounts. While banks have increased FX assets, it has seen a decline in the percentage of Russian currencies.

The central bank referred to in particular the “One result of the imposed sanctions on the foreign exchange market” statement.

Russia may consider increasing negative interest rates for banks that deposit dollars and euros in order to accelerate the fall in foreign currency’s share of the Russian banking industry, according to the central bank.

Late 2021 saw a steady 22% share of foreign currencies in household assets including deposits, stocks, and bonds. The central bank did not intend to reduce it.

In the same report, the central bank stated that Russian investors are now the primary driving force on the stock exchange despite restrictions on non-residents trading on Russian markets.

($1 = 61.1000 roubles)