Yuan exchange trading continues uninterrupted in Russia despite OFAC licence expiry
MOSCOW, Oct 14 (Reuters) -Trade in China's yuan proceeded as usual at the Moscow Stock Exchange (MOEX) on Monday, despite the expiry of a licence from the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) on Oct. 12 that allowed banks to deal with MOEX.
At 0830 GMT the rouble weakened by 0.13% to 13.48 against the yuan at the Moscow exchange with the current trade volumes at 6.6 billion roubles ($68.68 million).
The rouble weakened by 0.32% to 96.10 against the U.S. dollar RUB= at the over-the-counter (OTC) market, according to LSEG data. The rouble strengthened by 0.7% to 13.45 against yuan at OTC, according to LSEG data.
The OFAC licence was issued to allow banks to wind down operations with MOEX after Western sanctions on the exchange and its clearing agent, the National Clearing Centre, were introduced on June 12.
The sanctions stopped all trade in dollars and euros at MOEX, making China's yuan the most traded foreign currency in Russia. Trade in dollars and euros has shifted to the over-the-counter (OTC) market, obscuring price data.
Ahead of the licence expiry market participants were concerned that Chinese banks, which provide liquidity and settle trade in yuan, may decide to pull out as well for compliance reasons.
"Some Chinese banks are staying at MOEX, obviously there was a political decision for them to stay," one forex trader, who declined to be identified, said.
MOEX does not disclose information about the Chinese banks' operations. Currently, subsidiaries of Bank of China, ICBC, China Construction Bank and Agricultural Bank of China are operating in Russia, according to the central bank.
The Russian central bank's yuan swap facility, through which the regulator provides short-term yuan liquidity in case of shortage, was also operating normally with the limits unchanged from the previous week.
One-day rouble-dollar futures, which trade on the Moscow exchange and are a guide for OTC market rates, were up 0.48% at 95.1. The central bank's official exchange rate, which it calculates using OTC data, was set at 96.07 to the dollar.
The rouble weakened by 0.34% to 105.12 against the euro EURRUB=, LSEG data showed.
Brent crude oil LCOc1, a global benchmark for Russia's main export, was down 1.34% to $77.99 a barrel, erasing all gains made last week.
($1 = 96.1000 roubles)
Reporting by Gleb Bryanski, Editing by William Maclean
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