Sanctions on Russia Puts Focus on China’s Central Bank
- Russia has 13% of its reserves invested in yuan assets
- PBOC also has currency swap line with Russia central bank
The PBOC is yet to disclose how it will respond to the Russia sanctions.
Photographer: Andrea Verdelli/BloombergThis article is for subscribers only.
China’s central bank 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.
The People’s Bank of China has a multi-billion dollar currency swap with Russia’s central bank, allowing the two nations to provide liquidity to businesses so they can continue trading. China has also signed Russian banks onto its homegrown payments settlement system, seen as an alternative to the SWIFT messaging system, which many Russian lenders will be banned from using.