The Russian rouble weakened to 94 per dollar on Tuesday, waiting for the favourable impact of a month-end tax period to take hold, but trading in a fairly narrow range after last week’s wild volatility.
The rouble strengthened sharply last week after hitting a near 17-month low of 101.75 to the dollar, as the central bank hiked its key rate by 350 basis points to 12% and exporters increased selling of their foreign currency revenue following discussions with Russian authorities.
At 0723 GMT, the rouble was 0.3% weaker against the dollar at 93.96 and had lost 0.7% to trade at 102.64 versus the euro.
It had shed 0.5% against the yuan to 12.86. As the end of the month approaches, the rouble should gain the support of tax payments, where exporters usually convert foreign currency revenues into roubles to meet local liabilities.
“The rouble is still refusing to strengthen its position on the approaching peak of the tax period,” said Alor Broker’s Alexey Antonov in a note.
“Trading turnovers on the FX market remain high, which indicates that demand for foreign currency is still elevated.”
He said rouble devaluation would resume in the medium-term, but that the Russian currency could come close to 90 against the dollar in the short-term.
News from a summit in Johannesburg on Tuesday where leaders of the BRICS nations - Brazil, Russia, India, China and South Africa - are due to meet, could impact Russian assets, especially as member states look to boost the use of their local currencies.
Brent crude oil, a global benchmark for Russia’s main export, was down 0.2% at $84.28 a barrel. Russian stock indexes were lower.
The dollar-denominated RTS index was down 0.5% at 1,052.1 points.
The rouble-based MOEX Russian index was 0.1% lower at 3,138.4 points.
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