Tuesday, December 6

Russian rouble slides to two-week low near 61 vs dollar


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MOSCOW — The rouble fell to a two-week low near 61 to the dollar on Thursday, as a European Union plan for a price cap on Russian oil heightened risks that Russia’s foreign currency inflows may decrease.

The Russian currency strengthened sharply late last week on fears that the latest round of Western sanctions may target Moscow Exchange’s National Clearing Centre and restrict dollar and euro trading in Moscow.

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Those fears, which pushed the rouble to a near eight-year high against the euro and sparked wild volatility in the currency, appear to have subsided for now.

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By 1459 GMT, the rouble was 0.9% weaker against the dollar at 60.68, earlier coming within a whisker of the 61 mark.

It was 0.6% weaker at 58.73 versus the euro, falling to its lowest mark since Sept. 22 of 59.2375 earlier in the session. The rouble firmed 0.2% against the yuan to 8.56 .

“Demand for hard currency has been supported by the fact that no strict financial sanctions have been announced, which means market participants are still able to pay off their external debt and transfer currency abroad,” said SberCIB Investment Research.

“Contributing to the weakness of the rouble against the dollar, euro and yuan, was the continuing low activity by exporters, as well as heightened market uncertainty,” said Promsvyazbank analysts in a note.

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Export-focused firms usually convert their FX revenues to roubles when local liabilities need paying. Russia’s main tax period falls towards the end of the month.

The European Union’s latest sanctions package stopped short of seeking to restrict Moscow FX trading, but did include an oil price cap for Russian seaborne crude deliveries to third countries through European insurers.

Brent crude oil, a global benchmark for Russia’s main export, was up 1% at $94.3 a barrel, after a group of major producing countries, including Russia, announced their largest supply cut since 2020 ahead of European Union embargoes on Russian energy.

Russian stock indexes were falling.

The dollar-denominated RTS index was down 1.3% to 1,048.0 points, a near one-week low. The rouble-based MOEX Russian index was 0.5% lower at 2,019.4 points. (Reporting by Alexander Marrow; editing by Christian Schmollinger and Ed Osmond)



financialpost.com