Russian central bank lends more Chinese yuan under currency swap operations

MOSCOW : Russia’s central bank said it had provided banks with 2.5 billion Chinese yuan ($346.25 million) for the equivalent 31.8 billion roubles on Friday under currency swap transactions.

The bank said last week it was adjusting currency swap operation rates for sales of yuan from March 25.

It said it was also increasing the maximum daily volume of currency swap operations to 20 billion yuan from 10 billion yuan, on the first two and last two trading days of each month, to curb excessive volatility.

The banks’ maximum demand for yuan swaps was recorded on February 29, when the entire 10 billion yuan limit was used.

The central bank launched swap transactions for yuan and roubles in January 2023. The total amount of currency swap operations last year was 59.7 billion Chinese yuan, a bank report said.

The bank also said its liquid reserve assets were sufficient to maintain financial stability and perform necessary operations.

Opportunities for further diversification of reserve assets into currencies and financial instruments of “unfriendly” countries are limited by the risks inherent in these currencies and economies.

These factors predetermine the key role of the Chinese yuan in the formation of reserve assets, the bank said.

($1 = 7.2203 Chinese yuan renminbi)

($1 = 92.5705 roubles)