MOSCOW: The Russian rouble bounced back on Wednesday, gaining more than 1% versus the dollar on the day after mounting geopolitical concerns including a Russian military buildup near Ukraine had sent the currency tumbling on Tuesday.
At 1236 GMT, the rouble was 1% stronger against the dollar at 72.39, pulling away from its weakest point since Sept. 21 - which it hit on Tuesday - apart from a seconds-long drop on the Moscow Exchange on Oct. 22 that was probably caused by a trading error.
It had gained 0.9% to trade at 81.97 versus the euro .
After hitting its strongest level since mid-2020 of 69.21 against the dollar in late October, the rouble came under selling pressure last week after a Bloomberg report said that US officials had told European Union counterparts about concerns over possible Russian military intervention in Ukraine.
Russia's risk measured by five-year credit default swaps that reflect the cost of insuring exposure to sovereign debt eased slightly after earlier jumping to 101.522 basis points , the highest since April 22.
Russian troop movements near the border with Ukraine have spurred fears of a possible attack. But Moscow has dismissed such suggestions as inflammatory and complained about increasing activity in the region by NATO.
Matthew Ryan, senior market analyst at Ebury, said he was bullish on the rouble because of Russia's solid macroeconomic fundamentals and a rising differential between the Bank of Russia and most other major central banks.
Additional geopolitical concerns include the fallout from an anti-satellite missile test that Russia conducted and Germany's energy regulator suspending the approval process for the Nord Stream 2 gas pipeline.
"The headlines on NS2 may well be seen as an offshoot of the rising West-Russia tension, adding to the souring of 'Russia' sentiment," said BCS Global Markets in a note.
Brent crude oil, a global benchmark for Russia's main export, was down 0.5% at $81.99 a barrel.
Russian stock indexes were mixed.
The dollar-denominated RTS index was up 1.3% to 1,789.9 points. The rouble-based MOEX Russian index was down 0.2% at 4,112.6 points.
Comments
Comments are closed for this article.