Russian banks say they've run out of yuan as Chinese firms pull away from the nation
Payment scuffles between Russian companies and Chinese banks have escalated in recent weeks, with Chinese firms pulling back amid fear of sanctions.
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Russian banks say they've run out of yuan as Chinese firms pull away from the nation
Jennifer Sor
Sep 6, 2024, 10:18 AM EDT
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- Russia's yuan reserves are nearly depleted due to Chinese banks' fear of US sanctions.
- Lenders have urged Russia's central bank to address the yuan deficit, causing the ruble to drop.
- China's hesitance stems from US threats of secondary sanctions over Russia's Ukraine war financing.
Russia's banks have practically emptied their stash of yuan, largely because Chinese financial firms are spooked from doing business with the nation.
Lenders have urged Russia's central bank to address a yuan liquidity shortage in the nation, with insiders saying that access to the Chinese currency was running dry, Reuters reported.
Russia's ruble dropped nearly 5% against the yuan earlier this week, Reuters noted. The drop came shortly after Russia's finance ministry suggested the Central Bank of Russia would shrink its daily yuan sales, with central bankers selling just $200 million a day, down from the $7.3 billion sold daily in the last month.
Sberbank, a large state-owned lender in Russia, told Reuters it could no longer lend in yuan because it had "nothing to cover" the trade.
