MOSCOW: The Russian rouble strengthened slightly against the US dollar on Tuesday due to expectations of direct peace talks between Russia and Ukraine, despite losing some support from the central bank’s foreign currency sales.
By 0900 GMT the rouble was up around 0.5% to 80.60 to the US dollar, LSEG data based on over-the-counter quotes showed.
The Russian currency has risen by over 40% against the dollar so far this year.
“Starting from today, the volume of currency offered by the central bank will decrease by almost 40%, and the factor supporting the rouble will weaken,” BCS brokerage analysts said in a research note.
Russian President Vladimir Putin on May 11 proposed direct talks with Ukraine in Turkey’s capital Istanbul this week.
The proposal won the backing of US President Donald Trump, who said he might join the talks.
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Net sales of foreign currency support the rouble, but from Tuesday they fell to 6.55 billion roubles per day from 10.49 billion roubles in the previous month as the Finance Ministry has said it will buy some foreign currency for the fiscal reserves.
Against the Chinese yuan, which is used by Russia’s central bank for its foreign exchange interventions and is the most-traded foreign currency in Russia, the rouble was down 0.6% at 11.18 to the yuan on the Moscow Stock Exchange.
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