Rouble steady before OFZ bond auctions

• At 0726 GMT, the rouble was unchanged against the dollar at 72.44 and was flat versus the euro at 79.25.
• The finance ministry will auction three series of OFZ treasury bonds maturing in 2027, 2028 and 2039 on Wednesday.

MOSCOW: The Russian rouble was nearly flat against the U.S. dollar on Wednesday ahead of treasury bond auctions that generally help buttress the currency.

At 0726 GMT, the rouble was unchanged against the dollar at 72.44 and was flat versus the euro at 79.25.

The finance ministry will auction three series of OFZ treasury bonds maturing in 2027, 2028 and 2039 on Wednesday.

Demand for these bonds serves as a gauge of global market sentiment towards Russian assets.

On Wednesday, yields on 10-year OFZ bonds remained close to the record low of 5.45pc it touched this week on investors' hopes that the central bank will cut the key interest rate next month. Bond prices move inversely to their yields.

Analysts expect the rouble to receive only a short-lived boost from Wednesday's OFZ auctions.

"We do not believe in the rouble's strength in the medium term," Alexei Antonov, an analyst at Alor Brokerage, said in a note. "Oil prices are too low and the economy is too weak."

Preliminary data from the state statistics service on Tuesday showed economic growth in Russia had slowed 1.6pc in the first quarter.

The economy is expected to contract significantly this year because of low oil prices and the novel coronavirus, which has infected more than 300,000 people in Russia.

Oil prices were steady on Wednesday despite signs of improving demand, but worries about the economic fallout from the coronavirus pandemic capped gains.

Brent crude oil, a global benchmark for Russia's main export, was up 0.1pc at $34.69 a barrel by 0718 GMT.

Russian stock indexes were mixed.

The dollar-denominated RTS index was trading 0.1pc higher at 1,178.3 points.

The rouble-based MOEX Russian index was 0.1pc lower at 2,710.2 points.