In March, the yuan's presence in Russia's forex market soared to unprecedented levels, underscoring its expanding role in the nation's economy.
According to the latest financial risk assessment by the Bank of Russia, the yuan's volume in exchange-traded transactions reached 53%, while its proportion in over-the-counter (OTC) trades also achieved a new record of 39.6%.
Following the imposition of sanctions by the US and its allies due to Russia's invasion of Ukraine in February 2022, there has been a strategic shift by Moscow to diminish the dominance of the dollar and euro in its economic transactions. This move is part of a broader realignment towards Asian markets and reducing reliance on European trade partnerships.
The Bank of Russia reported a decline in the trading share of what it terms as “toxic” currencies, including the dollar and euro, to 46.4% on the exchange, down from 52.8% in February. In the OTC market, the share of these currencies dropped to 54.7% from 59.8% the previous month.
Elvira Nabiullina, the Governor of the Bank of Russia, in her address to the parliament, highlighted the nation’s efforts in facilitating transactions in various national currencies. Over the past year, transactions in currencies other than the dollar or euro surged from 39% to 67%, with the ruble and yuan becoming the primary currencies for settlements. “The dominance of the dollar and euro has nearly been halved,” she stated.
