Rouble strengthens on weaker dollar, modest risk appetite

MOSCOW: The Russian rouble firmed on Thursday, strengthening against the dollar in line with other currencies and supported by appetite for risk on global markets, despite a resurgence of COVID-19 cases around the world.

Prices for Russia's OFZ treasury bonds rose sharply, as investors around the world sought higher-yielding, riskier assets, trusting that a slew of new stimulus measures would boost economic activity.

By 1247 GMT, the rouble was 0.8% stronger against the dollar at 70.53 and had gained 0.7% to trade at 80.00 versus the euro.

The yield on Russia's benchmark 10-year OFZ fell to a one-week low of 5.73% before rising slightly, having opened at close to 6%. Bond yields move inversely to their price.

Uncertainty around the novel coronavirus continued to hang over global markets, with the United States reporting a record daily rise in new cases on Wednesday.

But as the threat of more US sanctions against Moscow has ebbed away, investors have been encouraged to return to Russian assets.

The external outlook is moderately positive, said Veles Capital analyst Elena Kozhukhova, adding that the rouble could strengthen past 70 to the dollar as it moves away from the seven-week low hit on Tuesday.

The rouble has come under pressure this week from a fall in daily sales of foreign currency by the finance ministry and investors' continued conversion of rouble dividend payouts into foreign currency.

Russian assets largely ignored US unemployment data, as weekly jobless claims remained high although they fell to 1.31 million, slightly below forecast, and down from 1.41 million in the previous week.

Brent crude oil, a global benchmark for Russia's main export, was up 0.3% at $43.42 a barrel.

Russian stock indexes were mixed.

The dollar-denominated RTS index was up 0.5% to 1,251.5 points. The rouble-based MOEX Russian index was 0.5% lower at 2,801.8 points.