Russia's Kremlin: Talks between Putin and Biden were open and business-like

Russia's Kremlin said on Tuesday that the talks held between US President Joe Biden and Russia President Vladimir Putin earlier in the day were open and business-like, according to Reuters. The Kremlin said that Putin told Biden about Ukraine's destructive attitude towards settlement in Eastern Ukraine and that it was wrong to put all of the responsibility on Russia's shoulders for current tensions. According to the statement put out by the Kremlin, the Ukraine crisis was the prevailing topic for discussion during the talks and Putin expressed concerns about Kyiv's allegedly provocative actions towards the Ukrainian region controlled by Russia-backed separatists (the Donbas region). 

The Kremlin confirmed that Putin and Biden had agreed to continue contacts and have ordered subordinates to start consultations on "sensitive questions" around Ukraine. As expected, Putin told Biden he wanted reliable legally-binding guarantees ruling out any further Eastward expansion of NATO, as well as guarantees that offensive strike systems would not be deployed in countries close to Russia. 

Separately, the US State Department said on Tuesday that it had intense consultation with the new German government over the response to a Russian invasion of Ukraine and that the US believes Germany will take significant action. It was earlier reported that an understanding was reached between US and German officials that the Nord Stream 2 pipeline would be shut down in response to any invasion. 

Market Reaction

Judging by the reaction in FX markets, talks went as expected and did not yield any significant progress towards a de-escalation of tensions. USD/RUB continues to trade well within the 73.50-74.50ish range that has prevailed over the past week or so.