Russia's Finance Ministry fully placed an issue of OFZ-IN inflation-pegged federal bonds worth RUB30.5bn ($470mn) at a weekly auction on November 11, the ministry said.

Average yield on the bonds amounted to 2.72% and the demand for bonds was expectedly high at RUB73.2bn.

In October, the ministry fully placed a RUB20.2bn issue of such bonds to solid demand of RUB92.6bn, guaranteeing a premium over the average inflation rate.

"High demand for the CPI-linker was barely a surprise, given that it was already squeezed at the debut placement in July," Maxim Korovin of VTB Bank commented at the time.

The Finance Ministry also said this week that it may place OFZ denominated in CNY/yuan in 2016, further expanding the best-performing emerging local debt market.

The head of the ministry's debt department, Konstantin Vyshkovsky, was cited by newswires as saying that CHY-denominated OFZs of up to $1bn would be regulated by Russian law and would trade on the Moscow Exchange.

Sergei Shvetsov, first deputy head of the Central Bank of Russia (CBR), said the issue would probably take place around mid-2016 as infrastructure between central depositories needs to be established to enable mainland Chinese investors to buy the bonds, RIA Novosti said.

As demand for OFZs slowed in the summer, the Finance Ministry responded by selling RUB50bn-60bn ($1bn) directly to Chinese investors and placing RUB75bn of OFZ-IN inflation-pegged bonds with a real guaranteed yield of 2%, which Uralsib said was "an attractive offer for the Russian debt market".