Chinese officials signalled on Saturday that they are willing to expand a US$24 billion currency swap programme to help Russia weather the worst economic crisis since the 1998 default. China has provided US$2.3 billion in funds to Argentina since October as part of a currency swap, and last month it lent US$4 billion to Venezuela, whose reserves cover just two years of debt payments.
By lending to nations shut out of overseas capital markets, China is bolstering the country's influence in the global economy and cutting into the International Monetary Fund's status as the go-to financier for governments in financial distress.
The rouble rose 4.9 per cent to 55.8 per US dollar in Moscow on Monday after Hong Kong-based Phoenix TV cited China's Commerce Minister Gao Hucheng as saying that expanding the currency swap between the two nations would help Russia.
The rouble has gained 10 per cent over the past two days, paring a sell-off that has made it the world's worst performing currency over the past six months.
Unlike Ukraine, where the pro-west government received a US$17 billion IMF-led bailout this year, Russia, Argentina and Venezuela are often at odds with the US and its allies, essentially keeping them out of the reach of the Washington-based institution. China holds the world's largest foreign-exchange reserves, allowing it to fill the void.