MOSCOW, September 23 (RIA Novosti) – The trading volume of the Chinese yuan on the Moscow stock exchange has been growing rapidly as a result of Russia's strengthening ties with China – a development that comes amid increasing Western sanctions against Russia.
"It would be logical to assume that in the coming months the Bank of Russia will diversify its foreign exchange reserves in favor of increasing the volume of the yuan against the dollar," Ivan Farafonov, deputy head of the treasury department of the Bank of Settlements and Savings said Tuesday as quoted by the Gazeta.ru online Russian newspaper.
According to data from the Moscow stock exchange cited by Gazeta.ru, the yuan-ruble trading volume on the Moscow stock exchange in August amounted to 27 billion rubles ($700 million), which is a new monthly record.
The sum is more than five times higher than the results of December 2013 (5.3 billion rubles, or about $137 million) and nine times higher than those of August 2013 (2.9 billion rubles, or around $75 million). Compared with the July trading volume (21.4 billion rubles, or almost $555 million) it is a more moderate growth – 26 percent.
During the first 17 days of September, the yuan-ruble trading volume was 23.9 billion rubles, or about $619 million.
Figures show that the yuan is also strengthening against the US dollar.
"Over the past three years, the yuan has demonstrated a positive dynamics - its dollar exchange rate increased by 5 percent. The IMF [International Monetary Fund] estimates that the yuan is undervalued against the dollar by around 40 percent," Farafonov noted.
"China continues to "catch up with and overrun America": in 2013, for the first time in history, China became a major trading nation with a trade volume of over $4 trillion. The average annual growth rate of China's GDP over the last five years was 8.5 percent, while that of the United States was 2.1 percent," Farafonov added.
Russia has been strengthening its cooperation with China and other Asia-Pacific nations amid economic sanctions that the West has been imposing against Moscow following Crimea's reunification with Russia.
In May, Russia's gas giant Gazprom and China National Petroleum Corporation (CNPC) signed a 30-year agreement on the annual export of around 38 billion cubic meters of Russian gas to China.
On September 1, Russia launched the construction of the 3,000-kilometer (1,860-mile) Power of Siberia pipeline in Yakutia.
According to Russian President Vladimir Putin, the new gas pipeline will significantly strengthen Russia's cooperation with the governments of the Asia-Pacific region.