Russia to Issue First Yuan-Denominated Domestic Bonds on December 8
Russia will sell its first yuan-denominated domestic government bonds on December 8, with maturities ranging from three to seven years, the Finance Ministry announced on Wednesday.
Russian Prime Minister Mikhail Mishustin shakes hands with Chinese President Xi Jinping during a meeting at the Great Hall of the People in Beijing, China, November 4, 2025. Sputnik/Dmitry Astakhov/Pool via REUTERSRussia will sell its first yuan-denominated domestic government bonds on December 8, with maturities ranging from three to seven years, the Finance Ministry announced on Wednesday. The move provides an investment option for the significant yuan liquidity accumulated by Russian exporters and banks from energy sales to China. The sale, first reported by Reuters on October 31, marks a step in Russia’s broader effort to expand non-dollar financing channels amid Western sanctions.
The bonds will be issued through Gazprombank, Sberbank, and VTB Capital, with the final volumes determined after the books close on December 2. Market sources indicated plans for up to four issues totaling 400 billion roubles ($5 billion). Investors will have the option to pay for bonds and receive coupon payments in either yuan or roubles, reflecting Russia’s growing use of alternative currencies in trade with China.
Why It Matters
This issuance highlights Russia’s strategic push to internationalize the yuan domestically and reduce reliance on the dollar. By tapping into the yuan liquidity generated from trade with China where bilateral trade reached a record $245 billion last year Russia seeks to diversify its financing options and bolster its sanctioned financial system. The move also signals Moscow’s intent to strengthen financial ties with Beijing while circumventing Western-dominated capital markets.
Challenges and Limitations
The bonds will be listed on the Moscow Stock Exchange (MOEX), which is under Western sanctions, making them largely inaccessible to most foreign investors, including Chinese buyers. Although Russia has been negotiating a “bridge” to allow Chinese investors to access Russian assets without Western oversight, no agreement has yet been reached. This could limit the potential foreign investor base and affect liquidity.
What’s Next
Investors will await the December 2 book closure to see the final issuance size. The success of the bonds could encourage Russia to issue more yuan-denominated securities in the future and strengthen its efforts to de-dollarize trade and finance. Observers will also watch whether Russia and China can finalize a market bridge to allow broader participation in future bond offerings.
With information from Reuters.