Russia’s US$140 billion of Chinese bond holdings are ‘major foreign assets’, could be used to skirt sanctions
- Bank of Russia could hold US$80 billion of yuan debt, while the National Wealth Fund is estimated to own US$60 billion, according to Australia & New Zealand Banking Group
- The total represents almost a quarter of foreign ownership in China’s domestic bond market, according to their estimates
Russia’s central bank and sovereign wealth fund probably own a combined US$140 billion worth of Chinese bonds, assets that they may seek to access given global sanctions, according to estimates by Australia & New Zealand Banking Group.
The Bank of Russia could hold US$80 billion of yuan debt, while the National Wealth Fund is estimated to own US$60 billion, analysts including Raymond Yeung wrote in a report on Wednesday.
Together, that represents almost a quarter of foreign ownership in China’s domestic bond market, they said.
We are watching if Russia will liquidate the assets if [Chinese yuan] cash is needed to meet other payment obligations
“Russia’s China bond holdings and [Chinese yuan] could be major foreign assets and currency that Russia can access,” the analysts said.
“We are watching if Russia will liquidate the assets if [Chinese yuan] cash is needed to meet other payment obligations.”
China could provide a financial lifeline to Russia if Beijing decides to buck Western efforts to cut its strategic partner out of the global financial system.
