Russia reportedly wants to further cut its dependence on the US dollar by buying up Chinese yuan on the currency market
- Russia will start purchasing yuan on the currency market in 2023 if the country's oil and gas revenues meet expectations, Reuters reported Thursday.
- The Bank of Russia will buy yuan if budget revenues from oil and gas exports exceed 8 trillion rubles, the report said.
Russia will start making purchases of yuan on the currency market in 2023 if the country's oil and gas revenues meet expectations, Reuters reported Thursday, with the potential move by Moscow aimed at further reducing its dependence on the US dollar and Western finance.
Russia in February stopped intervening on the currency market after its use of foreign exchange reserves was restricted by Western sanctions following Moscow's invasion of Ukraine. Russia has since accelerated its shift toward China's currency as its access to dollars and euros has been limited.
Two unnamed sources told Reuters the interventions will resume next year in yuan as long as revenues from oil and gas exports surpass 8 trillion rubles ($116.57 billion) as set out in budget plans.
The central bank can currently buy yuan, a banking source close to monetary authorities told Reuters. But the Bank of Russia wouldn't do so while the government continues to spend its oil and gas revenues.
"(However), if next year budget revenues from the export of oil and gas exceed 8 trillion rubles, then the central bank will buy yuan," the source said.
The yuan's share of the Russian currency market has risen to as much as 45%, up from less than 1% at the start of the year, the Moscow Exchange told Reuters last month.
Daily yuan-ruble trading volumes on the Moscow Exchange have exceeded dollar-ruble trades on some days, Reuters reported, citing Refinitiv data, a trend that may strengthen next year as an oil embargo and price cap squeeze Russian exports.
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