Russia Retaliates For Sanctions Approval, Hitting At US Diplomatic Corps

A Russian foreign ministry statement demanded the U.S. cut its diplomatic presence in Russia by September to 455 - the same number Moscow has in the USA - in a move sources said could force out hundreds of diplomats.

The Russian foreign ministry also said it was seizing holiday properties and a warehouse used by U.S. diplomats.

Speaking in Finland on Thursday, Putin said he "very much regrets" the worsening of relations between Russian Federation and the United States, blaming it on "anti-Russia hysteria" in domestic U.S. politics.

Before Mr Trump's decision to sign the bill into law, Republican senator John McCain said its passage was long overdue, a jab at Mr Trump and Republican-controlled Congress.

The new USA sanctions on Russian Federation were overwhelmingly approved by both houses of Congress despite objections from the Trump White House.

The legislation was in part a response to conclusions by USA intelligence agencies that Russian Federation meddled in the 2016 U.S. presidential election, and to further punish Russian Federation for its annexation of Crimea in 2014.

Russian Federation has always denied interfering and Mr Trump insists there was no collusion.

Kremlin spokesman Dmitry Peskov told journalists on a conference call Friday that Moscow had chose to retaliate before the bill went to Trump because "technically the form passed by the Senate is more important" and is "almost final".

President Vladimir Putin initially held off from retaliating, saying he would wait to see how Trump reacted after he came into the White House. Trump now has a 10-day window in which he can veto the bill, but the legislation is expected to garner enough support in both chambers to override any veto.

An official at the US Embassy, who declined to be named because they were not allowed to speak to the media, said the Embassy employed around 1,100 diplomatic and support staff in Russia, including Russian and US citizens.

"We have received the Russian government notification".

Russian state television channel Rossiya 24 said over 700 staff would be affected but that was not confirmed by the foreign ministry or the USA embassy.

Russia's deputy foreign minister Sergei Ryabkov had said after subsequent talks in Washington that the matter was "almost" resolved.

Lavrov said that Russian Federation was "still ready to normalize bilateral relations with the USA and to cooperate on the most important global issues".

The Russian Foreign Ministry said it was also seizing a Moscow dacha compound used by United States diplomats for recreation, from August 1, as well as a U.S. diplomatic warehouse in Moscow.

Thirty-five Russian diplomats were expelled from the United States in December under sanctions imposed by President Barack Obama in response to Russia's alleged meddling in the 2016 U.S. election.

After the financial crisis, gaining momentum in 2008, imports took a dent but recovered until peaking in 2011, when they started falling rapidly - well before the first sanctions were imposed.

The European Union warned the United States on Wednesday that the bloc would act "within days" if it did not receive reassurances on the potential impact of the sanctions on European interests.

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