Rouble slips in early trade; Belarus remains in focus

MOSCOW: The Russian rouble weakened on Wednesday after making strong gains in the previous trading session, helped by a weak US dollar, but hampered by fresh sanctions risk and continued political instability in neighbouring Belarus.

At 0724 GMT, the rouble was 0.2pc weaker against the dollar at 73.30 and has lost 0.1pc to trade at 87.44 versus the euro.

Brent crude oil, a global benchmark for Russia's main export, was down 0.9pc at $45.07 a barrel.

The rouble's growth yesterday was abnormal, said Alexei Antonov, head analyst at Alor Brokerage, also acknowledging that the weak dollar was aiding the rouble's strengthening.

"However, we have repeatedly seen that 'the Russian' has ignored the dynamics of the dollar against major world currencies," he said.

Belarus remained in focus after opposition politician Sviatlana Tsikhanouskaya appealed to European Union leaders not to recognise what she said was a fraudulent presidential election, with leader Alexander Lukashenko seeking to prolong his 26-year rule.

Lukashenko has claimed victory with over 80pc of votes.

Sanctions risk also weighed on Russian assets after a Republican-led US Senate committee said Russia used political operative Paul Manafort and the WikiLeaks website to try to help now-US President Donald Trump win the 2016 election.

The rouble could soon receive support from month-end taxes that prompt some companies to convert their foreign currency to meet local duties.

The finance ministry decided not to hold weekly OFZ treasury bond auctions this Wednesday, citing increased volatility on global markets.

Demand for these bonds usually serves as a gauge of global market sentiment towards Russian assets.

The yield on Russia's benchmark 10-year OFZ opened at a near four-month high of 6.24pc, before dropping to 6.14pc.

Bond yields move inversely to their price.

Russian stock indexes were falling.

The dollar-denominated RTS index was down 0.1pc at 1,309.9 points.

The rouble-based MOEX Russian index was 0.1pc lower at 3,047.2 points.