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Exclusive: Russia plans to issue debut sovereign yuan-denominated bonds, sources say
(www.reuters.com)
this post was submitted on 01 Nov 2025
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It's not about what China wants or doesn't.
These bonds are sold to Russian civilians. Their idea is that they are a bit like tax, but the state will pay them back after the war – state bonds are a very secure investment. You give the state one million Rubbles and you know you'll get back the same one million Rubbles plus a tiny tiny interest atop it. A very secure place to save your money.
It is a very interesting, and surprising, thing that they elected to denominate those bonds in Yuans instead of their own currency! Basically this means that people in the Russia don't trust the stability of their country's currency and would not buy the bonds if they were denominated in Russian Rubbles. They would believe that when they get their money back by selling the bond back to the state, the money will not be enough to pay a quarter of a loaf of bread, even if when they invested it, it was enough to furnish a home.
If the bonds are denominated in Rubbles, then the state will never be in trouble with them.
But now, with these ones being in Yuans: If the Rubble collapses, the bonds will retain their value. If the bond is worth 10 000 Yuans, then you pay their current value in Rubbles, which is a bit under 1 000 000 Rubbles. Then, if the value of the Rubble collapses, you still get 10 000 Yuans plus a very small interest back, but in the newly devaluated Rubbles that might be 1 000 000 000 Rubbles and ABRACADABRA: you have multiplied your money by one thousand. Good for you.
Except that...
If that happens, then how the heck is the Russia supposed to pay back those bonds? If you get one million and you need to pay back one billion, you've done a damn bad deal. And you will go bankrupt and you won't pay back a thing.
So, if the Russia assumes that Russians won't want to buy the bonds if they are denominated in Rubbles, why would they buy them if they are nominated in a foreign currency? It's a safe investment because you know you will get your money back for sure. But in the case of the Russia, you don't know that.
Of course, those bonds can be bought by anyone, not only Russian citizens. If China buys them, they can use those bonds to blackmail the Russia in the future: "If you don't do as we say, we will sell you back your bonds and you will go bankrupt."
So: All in all, it makes no sense for Russians to buy these bonds, but for China it does make sense.