MOSCOW: The Russian rouble eased slightly in early trade on Monday, shrugging off lower foreign currency purchases by the finance ministry, while an advance in oil prices steered the MOEX stock index to an all-time high.
At 0800 GMT, the rouble shed 0.1 percent to 65.40 versus the dollar and eased 0.2 percent to 73.42 versus the euro.
"There is now a pause in domestic FX selling. The tax period in March is over, while the April tax period has yet to enter in full force," said Evgeniy Koshelev, chief analyst at Rosbank in Moscow.
Export-focused companies have to convert their foreign currency to pay their local tax bills.
At the same time, there are some uncertainties regarding external conditions such as sanctions rhetoric and investors' attitude towards emerging markets, Koshelev said.
On the domestic data front, consumer inflation stabilised, increasing the chances of a central bank rate cut later this year.
"This factor will act as support for the rouble ... in the absence of new information about sanctions," analysts at Nordea Bank said in a note.
A possible cut to the central bank key rate, now at 7.75 percent, will drive yields of Russian OFZ treasury bonds lower, which will boost their prices.
The rouble also felt some relief from lower state foreign currency buying after the finance ministry said last week it would buy less foreign currency in April.
Prices for oil were in focus as Brent crude futures rose towards $71 per barrel, their highest since November.
Higher oil prices should help the rouble to firm beyond 65 versus the dollar "in the absence of negative surprises related to sanctions," said analysts at Promsvyazbank.
Russian stock indexes started the week higher thanks to rising oil prices. The rouble-based MOEX hit its highest ever level of 2,555.5 points before paring gains to 2,550.2 points, up 0.4 percent on the day.
Comments
Comments are closed for this article.