In the Spring of 2018, Russia’s Central Bank dumped $101 billion in US holdings from its huge reserves, shifting into euros and yuan amid a new round of US sanctions. The Central Bank moved the equivalent of $44 billion each into the European and Chinese currencies in the second quarter, according to a report published by the Bank of Russia, which discloses the data with a six-month lag. Another $21 billion was invested in the Japanese yen.
The Chinese currency accounted for 15 percent of total holdings at the last reading, up from 5 percent at the end of the first quarter, according to the report. That puts Russia’s yuan share at about ten times the average for global central banks, with its total holdings of the currency accounting for about a quarter of world reserves in yuan, according to International Monetary Fund data.
The shift has reduced the credit quality of Russia’s reserves, with the share of AA-rated assets dropping to 27 percent from 43 percent, according to the central bank report. Yields were higher on the yuan holdings, at 3.2 percent versus 0.35 percent for dollar assets.
