MOSCOW: The Russian rouble reversed earlier gains on Tuesday, breaking a five-day winning streak as a cautious mood prevailed ahead of a key OPEC meeting on Thursday.
At 1305 GMT, the rouble was 1.2 percent weaker against the dollar at 45.54 and 1.1 percent weaker at 56.59 versus the euro.
The rouble had risen on opening, helped by monthly tax payments. Russian companies pay the monthly mineral extraction tax on Tuesday, requiring major exporters to convert foreign currency earnings into roubles. Profit tax, another major payment, falls due on Nov. 28.
However, the rouble later swung into negative territory, illustrating market volatility in conditions of thin liquidity. Traders said a single large bid for foreign currency had contributed to the reversal.
"The cause of the present dynamic could be a large bid knocking prices even with offer of foreign currency present," said Otkritie trader Pyotr Neimyshev. "'Large' in current conditions, because now such a move can be caused, for example, by a purchase of $200 million."
The rouble had risen for each of the preceding five sessions, against the backdrop of a stabilisation of the oil price before Thursday's OPEC meeting where the oil producers' club may decide to cut production to support prices.
On Tuesday oil benchmark Brent was up around 0.6 percent to over $80 a barrel, but opinions are divided over whether OPEC will agree on production cuts.
Analysts warned that a failure to deliver on such cuts could cause significant falls in the oil price with negative consequences for the rouble.
"Looking forward, we think Russian FX trading is to remain volatile, especially if the outcome of OPEC's meeting disappoints," VTB Capital analyst Maxim Korovin said in a note.
Russian stock indexes fell back on Tuesday, as uncertainty over the OPEC meeting encouraged caution after recent gains.
The dollar-based RTS index was down 1.7 percent to 1,058 points, while the rouble-based MICEX was broadly flat at 1,529 points.
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