Rouble breaks through 75 against dollar as central bank confirms FX sales
- The rouble did not react to what VTB Capital analysts described as the key event of the week.
- Alor Broker analyst Alexei Antonov warned that another aggravation of relations between Russia and the West could lead to a strong fall in the Russian currency.
MOSCOW: Russia's rouble passed 75 against the dollar on Thursday after the central bank confirmed plans to sell more foreign currency and played down the impact of a recent currency collapse.
By 1449 GMT, the rouble was 0.4% stronger against the dollar at 75.01, earlier touching a one-week high below 75, but had lost 0.2% versus the euro, trading at 89.11.
The rouble did not react to what VTB Capital analysts described as the key event of the week, as the European Central Bank kept its copious stimulus unchanged at a policy meeting, in line with Reuters' forecasts.
The Russian currency was boosted by Central Bank Deputy Governor Alexei Zabotkin confirming plans to convert foreign currency proceeds from the sale of its stake in Sberbank into roubles by the end of this year.
He also said the rouble's poor performance against the dollar this year, losing more than 20% of its value in the wake of low oil prices, the COVID-19 pandemic and recent geopolitical risks, would not have any special economic impact.
Alor Broker analyst Alexei Antonov warned that another aggravation of relations between Russia and the West could lead to a strong fall in the Russian currency.
Lingering political risks related to turmoil in neighbouring Belarus and the fallout from the suspected poisoning of Kremlin critic Alexei Navalny continued to play against Russian assets, particularly the danger of more sanctions against Moscow.
Russian markets were given additional support on Wednesday as the Federal Statistics Service, Rosstat, revised its GDP figure to show the economy shrank 8% year-on-year in the second quarter, less than the 8.5% previously reported.
Zabotkin said central bank will consider a rate cut next week "thoughtfully and with care" as the coronavirus pandemic makes such decision more complicated.
Brent crude oil, a global benchmark for Russia's main export, was down 0.8% at $40.45 a barrel.
Russian stock indexes were up.
The dollar-denominated RTS index was up 1% at 1,213.0 points. The rouble-based MOEX Russian index was up 0.4% at 2,888.9 points.
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