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The rapid adoption of China's yuan in Russia's economy, driven by tensions with the West over the Ukraine conflict, may have reached its limit. The threat of US secondary sanctions has deterred further yuan usage in Russia, as it hampers bilateral trade and payments. The gap in yuan borrowing rates between Russia and China has widened since the US warned of sanctions, indicating a shortage of yuan in Russia and a reluctance among Chinese banks to provide liquidity. While Russia has become China's main trading partner and the yuan accounts for a significant portion of Russia's export and import payments, annual growth in trade between the two countries has slowed. The yuan's usage in Russia is mostly driven by oil exports, and other countries are still hesitant to accept yuan as payment for imports. Several of China's major banks have stopped accepting yuan from Russia, impacting imports, although the issue has been resolved using smaller regional banks. The future of yuan usage in Russia will depend on the extent of trade between the two countries and the yuan's acceptance as a settlement currency with other nations. The yuan has gained prominence in Russia's economy, being used for various purposes such as shareholder payments, loan conversions, bond issuances, and savings deposits. However, the potential for further yuan usage in Russia is limited compared to the progress that has already been made. [Extracted from the article]

India is set to receive two Russian-made warships in the coming months, despite US sanctions that have made it difficult to pay for Russian weapons systems. The delivery of the ships, which are part of a four-ship deal signed in 2018, has been delayed due to the war in Ukraine and war-related supply chain issues. India and Russia have found a way to work around the payment issue, although the details have not been disclosed. Russia remains India's largest supplier of military hardware, accounting for 36% of India's arms imports. [Extracted from the article]

The article reports on the alleged worsening division in the global financial system as shown in the removal of Russia from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) system as a response to its invasion of Ukraine. Also cited are how the sanctions against Russia failed due to its economic independence and the attractiveness of its main exports of diamonds and fossil fuels and the new reserve currency proposed by Russia's Vladimir Putin.

Yuan financing in Russia is becoming more expensive and scarce, making it difficult for companies to access foreign capital. This is particularly challenging for energy and mining companies that have relied on the yuan for their foreign currency needs. Insufficient yuan liquidity in Russia and demand from importers are contributing to higher borrowing costs. As a result, companies like MMC Norilsk Nickel PJSC are faced with choosing between expensive ruble funding or the rising cost of domestic yuan debt. The volume of Russian corporate yuan bonds has stalled, and the average yield on yuan securities has increased. The reluctance of major Chinese banks to link Moscow's yuan market with offshore markets is a key factor in the liquidity crunch. Russian lenders have had to turn to the central bank's Chinese currency swaps to meet their needs, resulting in a significant increase in yuan funding costs. Russian companies have also faced barriers in borrowing within China itself due to capital controls. The strain on Russian corporate coffers could deprive industries of capital at a time when refinancing needs are increasing. [Extracted from the article]

Li's comments are a reminder that China-Russia relations have remained warm, especially since Russian leader Vladimir Putin ordered the invasion of Ukraine in February 2022. (Bloomberg) -- Chinese Premier Li Qiang told his Russian counterpart that he wants to boost their trade and other cooperation, underscoring the nations' close ties with the war in Ukraine well into its second year. [Extracted from the article]

(Bloomberg) -- Russia's rising trade in the yuan in the wake of the war in Ukraine and western sanctions may end up undermining the US dollar, according to the European Bank for Reconstruction and Development. Russia has also moved to settle a much bigger share of its trade in yuan at the expense of dollars and euros. [Extracted from the article]

(Bloomberg) -- Russia is likely to resume buying foreign currency for its reserves as soon as this month as rising oil earnings stabilize public finances despite US and European efforts to squeeze Kremlin income. The outlook is shifting as a result of the rising export prices of Russia's crude and changes in the tax formula that the Finance Ministry expects will deliver some 600 billion rubles of additional budget income. [Extracted from the article]

The shift comes as Nornickel, which supplies about 7% of the world's nickel, hopes to boost sales to China this year as some European buyers shun Russian commodities. (Bloomberg) -- Russia's top miner, MMC Norilsk Nickel PJSC, is selling some of its metal in yuan at prices set in Shanghai, a sign of how the invasion of Ukraine is redrawing global commodity flows and handing greater power to China. [Extracted from the article]

(Bloomberg) -- Russia is considering a plan to buy as much as $70 billion in yuan and other "friendly" currencies this year to slow the ruble's surge, before shifting to a longer-term strategy of selling its holdings of the Chinese currency to fund investment. Russia Eyes Buying "Friendly" Currencies to Stem Ruble Surge Before the war, Russia had steadily increased its yuan investments as part of its diversification campaign, becoming one of the largest holders of reserves in the Chinese currency in the world. Russia Mulls Buying $70 Billion in Yuan, "Friendly" FX. [Extracted from the article]

Russia Mulls Buying $70 Billion in Yuan, "Friendly" Currencies (Bloomberg) -- Russia is considering a plan to buy as much as $70 billion in yuan and other "friendly" currencies this year to slow the ruble's surge, before shifting to a longer-term strategy of selling its holdings of the Chinese currency to fund investment. Russia Eyes Buying "Friendly" Currencies to Stem Ruble Surge Before the war, Russia had steadily increased its yuan investments as part of its diversification campaign, becoming one of the largest holders of reserves in the Chinese currency in the world. [Extracted from the article]

The U.S. and its allies imposed sweeping sanctions on Russia following its Feb. 24 invasion of Ukraine, including limits on the central bank's reserves. (Bloomberg) -- Russia has enough holdings in yuan and gold even after the U.S. and its allies imposed sanctions on its reserves in dollars and other currencies, Bank of Russia Governor Elvira Nabiullina said in her annual report to parliament Monday. [Extracted from the article]

These will be the first commodity shipments paid for in yuan since the U.S. and Europe penalized Russia and cut several of its banks off from the international financial system, according to traders. (Bloomberg) -- Russian coal and oil paid for in yuan is about to start flowing into China as the two countries try to maintain their energy trade in the face of growing international outrage over the invasion of Ukraine. [Extracted from the article]

According to a report by Dow Jones, Saudi Arabia is in active discussions with China to price some of its oil sales in Chinese yuan. This news caused the yuan to reverse earlier declines and increase in value. While the U.S. dollar is currently the dominant currency in global trade and oil markets, other currencies like the yuan are gaining traction in cross-border transactions. The ongoing conflict in Ukraine and the resulting sanctions on Russia have raised questions about alternatives to the U.S. dollar, with the yuan being a focus due to China's relationship with Russia. The report does not indicate the likelihood of Saudi Arabia making this switch or the extent to which its sales would be denominated in yuan. However, it does highlight the ongoing debate about alternatives to the U.S. dollar. [Extracted from the article]

Chinese assets, including stocks, bonds, and currencies, experienced volatile trading on Tuesday. Concerns about China's ties with Russia and ongoing regulatory pressure contributed to the decline in stocks, particularly in the tech sector. The Chinese yuan also continued to lose value, and the yield on government bonds increased. The market is weighing attractive valuations against regulatory risks, including the possibility of U.S. delisting. Despite economic data beating estimates, lockdowns in major Chinese cities are dampening the outlook. [Extracted from the article]

Investors in Chinese financial markets are increasingly seeking protection as pressure mounts from various sources. The government's crackdown on tech firms and property developers, coupled with the strict Covid Zero policy and concerns over China's alliance with Russia, have led to a loss of confidence among global investors. This comes at a crucial time for China's ruling elite, as a leadership reshuffle is expected in the autumn. The MSCI China Index has plummeted, wiping trillions of dollars from the value of Chinese and Hong Kong shares, and the cost of hedging against losses has surged. [Extracted from the article]

(Bloomberg) -- U.S.-listed Chinese stocks resumed a steep selloff on Monday, following an 18% rout last week, as concerns about Beijing's close relationship with Russia added to losses spurred by a Chinese crackdown on tech giants and the growing risk of U.S. delistings. Investors in technology stocks that are valued on future growth expectations are also closely watching the Federal Reserve's rate-hike cycle, expected to kick off this week with a 25 basis-points move. [Extracted from the article]

Chinese stocks trading in the U.S. have plunged 75% from their peak—eclipsing losses during the global financial crisis in 2008. [ABSTRACT FROM AUTHOR]

The foreign ministers of Ukraine and Russia made little progress in bridging their differences in the highest levels talks since Russia's invasion two weeks ago. Uniqlo Will Suspend Operations in Russia (10:49 a.m.) The Japanese clothing company Uniqlo said it will temporarily suspend its operations in Russia, days after its CEO argued that clothing was a necessity and "the people of Russia have the same right to live as we do.". [Extracted from the article]

(Bloomberg) -- It has just got a lot more expensive for Russia to deal with its biggest trade partner China. The PBOC also has a multi-billion dollar currency swap (150 billion yuan versus $1,750 billion in ruble) with Russia's central bank, allowing the two nations to provide liquidity to businesses to continue trading. [Extracted from the article]

Renaissance Capital says Russia may start to import gold One thing that could keep Russia's dollar reserves at high level is the country's dependence on exporting commodities, like oil which are denominated in the greenback. [Extracted from the article]

Central bank moves reserves to euros, yuan in broad shift That puts Russia's yuan share at about ten times the average for global central banks, with its total holdings of the currency accounting for about a quarter of world reserves in yuan, according to International Monetary Fund data. [Extracted from the article]

The authorities have "no plans to give up dollar settlements, ban the circulation of the dollar or impose any other restrictions", it said. Russia has long struggled to limit its reliance on the dollar because of the relative stability of the U.S. currency its use to price Russia's main commodity exports. [Extracted from the article]

Investors in debt from PDVSA have been burned by sanctions Here are some lessons Russian investors can take away from the saga faced by bond investors in Petroleos de Venezuela SA, the state-owned oil company known as PDVSA, which is currently behind on $730 million of interest payments:. [Extracted from the article]

Russia will issue renminbi government bonds by early 2020, said Russia deputy finance minister Alexey Moiseev on Thursday at the Moscow Exchange Forum in London. The move is a bid to widen access for Russian corporates eyeing renminbi debt, while diversifying funding sources away from the dollar. [ABSTRACT FROM AUTHOR]

This article reports on the move by China and Russia to settle their bilateral trade deal using their respective currencies instead of the U.S. dollar. The agreement was reached during the visit of Chinese Premier Wen Jiabao to Russia on November 23, 2010. It notes that China started to allow the yuan to trade against the Russian ruble a day before the announcement of the agreement. It says that the ruble is the seventh foreign currency in the interbank foreign exchange market. Reduced transaction costs and risks are some of the benefits of the deal.

Russia will need to pay at least "dozens of basis points" more than the cost of placing dollar debt to tempt investors, he said. Selling yuan debt to onshore investors will still entail "losses, risks and expenses" for Russia and that's putting a brake on the issue, Vyshkovsky said. [Extracted from the article]

Russian companies have so far dipped into the yuan bond market only offshore, including sales from Gazprombank OJSC, Russian Agricultural Bank OJSC and VTB Bank OJSC over the past three years. Aside from the yuan offering, Storchak said external borrowing next year will depend on market conditions and the ministry isn't planning another sale of inflation-linked bonds for now because it doesn't have immediate funding needs in rubles. [Extracted from the article]

Plan would link countries' central depositaries, Moiseev says Russia and China are working on an eastern equivalent to Euroclear Bank SA's bond, stock and currency settlement services as they seek to boost two-way investment in their markets. [Extracted from the article]

VEB's Fradkov says bank plans to discuss SWIFT alternative VEB has cooperated with Russia's biggest trading partner since 2005 and has borrowed $10.7 billion in loans from China in the past decade, Fradkov said. [Extracted from the article]

Russia fell short of its bond auction target for a third week as contagion from China's yuan devaluation spread through emerging markets. Derivatives traders have switched to positioning for interest-rate increases in the next three months after Russia cut benchmark borrowing costs 600 basis points this year. [Extracted from the article]

The article offers information on financial factors affecting the economic factors of a country such as recession and recovery. It states that global economic recovery has slowed down resulting in decrease in business confidence. Reference is made to the recession in Russia as a consequence of the US and the European Union economic sanctions. The article throws light on the extension of renminbi clearing service hours by Bank of China (Hong Kong).

The article discusses the economic incentives for joining the Customs Union trade bloc which Tajikistan is hinting at following Ukraine's agreements with Russia. Topics covered include customs tariffs, Tajikistan's lack of common border with member states and the cost to Russia of getting former Soviet republics together. Also mentioned are the integration projects of nations in Central Asia, an overall anti-Russian trend and Tajikistan's trading with China in Chinese yuan currency.

China has made little headway in persuading the Russian government and Russian institutions into using the renminbi, as the fate of a sovereign bond in the currency remains uncertain and trading of RMB products stalls. But market participants are not giving up just yet, with a new trading platform set to launch next year, writes Paolo Danese. [ABSTRACT FROM AUTHOR]

The article examines the possible impact of the decision of China and Russia not to use the U.S. dollar in their conduct of bilateral trade, but instead will use their domestic currencies, the Chinese yuan and the Russian ruble. Accordingly, such move is an indication of the dollar's imminent decline. It explains why the decision has more symbolic effect than any tangible economic or geopoliticla effects. Also noted is the role of the reserve currency.

The article discusses on the completed technical preparations by Russia for its first renminbi (RMB) bond that will inaugurate the Baikal bond market, based on the statement of the Central Bank of Russia. Topics mentioned include the establishment of the renminbi clearing house in Moscow, Russia on March 22,2017, the effect of the clearing house to the first treasury bond in the country, and the disclosure of the investors that will participate in the deal.

The article discusses the introduction of the renminbi-denominated (RMB) bond by Russia to enhance the cross-border financial activity between China and Russia. Particular focus is given to the objectives of the bond including to target Chinese investors, selection of Bank of China Moscow as underwriters, and renaming as Baikal bond for distinction. The article reports the RMB-denominated bond to be launched in Dim Sum format.

The article reports on the negotiation between the Central Bank of Russia (CBR) and the People's Bank of China (PBoC) for the establishment of a renminbi (RMB) clearing bank and settlement services in Russia. Topics discussed include the increase in RMB-related businesses in Russia, the facilitation of cross-border RMB transactions between banks and companies, and Chinese banks that hold banking licenses in Russia.

The article reports that Russia is preparing to sell an offshore renminbi (RMB) bond. Topics discussed include the issuance as the country's debut in the currency and the first international bond of the Russian government since 2013 and the plan of Russia to ask China to relax its outbound investment schemes.

The article reports developments in the renminbi (RMB) market as of March 18, 2016. It cites the 40% decline of China's RMB denominated cross border trade settlement to its lowest level since April 2013 in February 2016. Also cited are the decline in spot trading turnover for the onshore RMB(CNY)/Ruble pair at the Moscow Exchange in Russia, and the renewal by the Monetary Authority of Singapore (MAS) and the People's Bank of China (PBoC) of their bilateral currency swap line.